The peroxisome proliferator-activated receptors (PPARs) are nuclear hormone transcription factors that regulate genes associated with lipid and glucose metabolism. Recent evidence suggests that PPAR-gamma may also act as a negative immunomodulator. To investigate the potential role of PPAR-gamma in regulating airway inflammation, we characterized the expression and function of PPAR-gamma in airway epithelial cells. Airway epithelial cells constitutively express PPAR-gamma-specific messenger RNA and protein. Further, airway epithelial PPAR-gamma is inducible by interleukin (IL)-4 in NIH-A549 cells. Two PPAR-gamma agonists, the prostaglandin D2 metabolite 15-deoxy-(Delta)(12,14) prostaglandin J2 (15d-PGJ2) and a thiazolidinedione, ciglitazone, were used to study the effects of PPAR-gamma activation on airway epithelial cytokine expression. Activation of PPAR-gamma stimulated a PPAR-responsive reporter gene in a ligand-specific manner. In NIH-A549 cells, both ligands also blocked the cytokine-induced expression of the inducible form of nitric oxide synthase in a dose-dependent manner. In contrast, ciglitazone alone had a slight effect on cytokine-induced IL-8 secretion, but markedly inhibited IL-8 secretion from cells pretreated with IL-4. The demonstration of PPAR-gamma expression and function in airway epithelial cells expands the immunoregulatory role of PPARs and suggests a critical role for PPAR-gamma in antagonizing proinflammatory pathways in the airways.