Pegylated interferon and thalidomide demonstrate immunomodulatory and antiangiogenic activity, and efficacy in melanoma. The combination was evaluated in a phase II trial. Eligibility included biopsy-confirmed malignant melanoma with metastases and progression, maximum of two earlier systemic therapies, performance status of 0-2, and adequate hepatic, bone marrow and renal function. Pegylated interferon was administered at a dose of 0.5 microg/kg subcutaneously weekly and thalidomide 200 mg orally daily. Toxicity was evaluated every 2 weeks and response every 8 weeks. Eighteen patients were enrolled in this trial. Median age was 55.5 years (range: 29-80 years). Seventeen patients had visceral metastases and one had lymph node-only metastases. Two patients had brain metastases. Nine patients had received earlier adjuvant therapy and 16 patients had received earlier therapy for metastatic disease. Performance status was 0, 1 and 2 in 11, six and one patients, respectively. Severe (grade 4) toxicities observed were anemia in two patients and thrombocytopenia in one patient. No treatment-related deaths occurred. Dose escalation of thalidomide to 300 mg daily was feasible in four patients. One therapy-related hospitalization for nausea and dehydration occurred. No objective responses were noted; three patients demonstrated disease stabilization. The regimen of pegylated interferon and thalidomide was well tolerated. The combination, however, failed to demonstrate clinical efficacy in pretreated metastatic malignant melanoma.