Our knowledge of the induction of new molecules by IFN-gamma has led to the characterization of IP-10 and the preparation of a monospecific, polyclonal antibody. Using this reagent we have now examined inflammatory states occurring in human skin and used immunocytochemical staining for the expression of both Ia and IP-10 determinants. After evoking a delayed-type response to purified protein derivative of tuberculin (PPD), we noted the presence of IP-10 in dermal macrophages and endothelial cells. Intense staining of the basal layer of epidermal keratinocytes was prominent at 41 h, and by 1 wk the entire epidermis was staining. The comparison of the amount of IP-10 secreted by keratinocytes vs. macrophages, fibroblasts, and endothelial cells revealed that keratinocytes were by far the major producers of this molecule. The expression of Ia occurred in conjunction with IP-10. The injection of rIFN-gamma mimicked many of the features of the PPD response, including the expression of both Ia and IP-10 by epidermal keratinocytes. Coexpression was also found in the natural lesions of tuberculoid leprosy and cutaneous Leishmaniasis. However, it was absent in lepromatous leprosy, a state where activated T lymphocytes are not present. We suggest that the local production of IFN-gamma by T cells of the dermal infiltrate induces IP-10 formation in both the dermis and epidermis. IP-10 and Ia then serve as specific markers of immune IFN and its possible influence on effector cells of the cell mediated immune response.