We recently reported that a hypoxia-responsive element mediates a novel pathway of transcriptional activation of the inducible nitric oxide synthase (iNOS) promoter in murine macrophages treated with IFN-gamma plus hypoxia (1% O2). In this study, we investigated the expression of NOS activity and the regulation of NOS induction in IFN-gamma treated ANA-1 murine macrophages or thioglycollate-elicited peritoneal macrophages cultured under hypoxic conditions. We found that murine macrophages stimulated with IFN-gamma plus hypoxia, despite a significant accumulation of iNOS mRNA, did not release nitrite into culture supernatant. However, cytosol from macrophages treated with IFN-gamma plus hypoxia contained significant levels of iNOS protein and enzymatic activity. Experiments in which cells were treated with IFN-gamma plus hypoxia and then cultured in normoxic conditions (20% O2) demonstrated that reoxygenation was required to achieve detectable accumulation of nitrite in the culture supernatant. Furthermore, we demonstrated that IL-4 inhibited IFN-gamma plus hypoxia-dependent induction of iNOS mRNA expression, iNOS protein, and enzymatic activity. Experiments in which ANA-1 macrophages were transfected transiently with the full-length iNOS promoter linked to a chloramphenicol acetyltransferase reporter gene demonstrated that IL-4 also down-regulated the IFN-gamma plus hypoxia-induced activation of the iNOS promoter. These data establish that hypoxia is a costimulus with IFN-gamma for the induction of iNOS activity in ANA-1 macrophages as well as in murine peritoneal macrophages, and they provide the first evidence that IL-4 inhibits hypoxia-inducible gene expression. In addition, our results suggest that hypoxia, which occurs in many pathologic conditions, may play an important role in the activation of murine macrophages.