Elucidating the factors that inhibit the increase in airway smooth muscle (ASM) mass may be of therapeutic benefit in asthma. Here, we investigated whether interferon-gamma (IFN-gamma), a potent inducer of growth arrest in various cell types, regulates mitogen-induced ASM cell proliferation. IFN-gamma (1-100 U/ml) was found to markedly decrease both DNA synthesis and ASM cell number induced by the mitogens epidermal growth factor (EGF) and thrombin. Interestingly, IFN-gamma had no effect on mitogen-induced activation of three major mitogenic signaling pathways, phosphatidylinositol 3-kinase, p70(S6k), or mitogen-activated protein kinases. Mitogen-induced expression of cell cycle regulator cyclin D1 was increased by IFN-gamma, whereas no effect was observed on degradation of p27(Kip1). Expression array analysis of 23 cell cycle-related genes showed that IFN-gamma inhibited EGF-induced increases in E2F-1 expression, whereas induction of c-myc, cyclin D2, Egr-1, and mdm2 were unaffected. Induction of E2F-1 protein and Rb hyperphosphorylation after mitogen stimulation was also suppressed by IFN-gamma. In addition, IFN-gamma decreased activation of cdk2 and expression of cyclin E, upstream signaling molecules responsible for Rb hyperphosphorylation in the late G1 phase. IFN-gamma also increased levels of IFI 16 protein, whose mouse homolog p202 has been associated with growth inhibition. Together, our data indicate that IFN-gamma is an effective inhibitor of ASM cell proliferation by blocking transition from G1-to-S phase by acting at two different levels: modulation of cdk2/cyclin E activation and inhibition of E2F-1 gene expression.