Clinical studies have demonstrated beneficial effects of interferon-beta (IFN-beta) therapy in multiple sclerosis (MS) patients. However, the mechanism of action of IFN-beta in MS remains unknown. IFN-beta has even been demonstrated to enhance isolated T cell secretion of IFN-gamma, a cytokine proven to be deleterious in MS. However, IFN-beta inhibits IFN-gamma secretion of T cells, when they are stimulated by antigen presenting cells (APC). We therefore decided to study the effects of IFN-beta on the in vitro differentiation of dendritic cells (DC), a major class of APC. First, we found that the addition of IFN-beta at the initiation of the differentiation did not modify DC morphology, but enhanced the expression of molecules involved in antigen presentation (HLA-DR, B7/1 and B7/2). However, DC, differentiated in the presence of IFN-beta, secreted less interleukin-12 (IL-12) both spontaneously and upon activation by CD40-ligand bearing cells. As a consequence, DC differentiated in the presence of IFN-beta induced less IFN-gamma secretion by alloreactive T cells. We conclude that the direct action of IFN-beta on DC results in inhibition of their ability to secrete IL-12 and to elicit Thelper-1 (Th-1) type responses. These results are of particular interest in MS, in which a critical role for IL-12 has recently been suggested by a number of clinical and experimental observations.