N eonatal skin fibroblasts were cultured in supernatants of peripheral blood monocytes that had been cultured with and without lactoferrin. Granulocyte-monocyte colony-stimulating activity (CSA) was measured in supernatants of the fibroblast cultures with normal T lymphocyte-depleted, phagocyte-depleted, low density bone marrow target cells in colony growth (colony-forming unit granulocyte/macrophage) assays. Monocyte-conditioned medium contained a nondialyzable factor that enhanced by 17-50-fold the production of CSA by fibroblasts. The addition of lactoferrin to monocyte cultures reduced the activity of this monokine by 75-100%. Lactoferrin did not inhibit CSA production by monokine-stimulated fibroblasts. We conclude that under appropriate conditions human fibroblasts are potent sources of CSA, that the production of CSA by these cells is regulated by a stimulatory monokine, and that the production and or release of the monokine is inhibited by lactoferrin, a neutrophil-derived putative feedback inhibitor of granulopoiesis. We propose that the major role of mononuclear phagocytes in granulopoiesis is played not by producing CSA, but by recruiting other cells to do so, and that in the steady state, feedback regulation of neutrophil production may occur as a result of a mechanism that inhibits the recruitment phenomenon.