PLATELET-ACTIVATING factor (PAF) is a potent pro-inflammatory phospholipid that activates cells involved in inflammation^1,2. The biological activity of PAF depends on its structural features, namely an ether linkage at the sn-1 position and an acetate group at the sn-2 position. The actions of PAF are abolished by hydrolysis of the acetyl residue, a reaction catalysed by PAF acetylhydrolase. There are at least two forms of this enzyme-one intracellular and another that circulates in plasma and is likely to regulate inflammation. Here we report the molecular cloning and characterization of the human plasma PAF acetylhydrolase. The unique sequence contains a Gly-Xaa-Ser-Xaa-Gly motif commonly found in Upases. Recombinant PAF acetylhydrolase has the sub-strate specificity and lipoprotein association of the native enzyme, and blocks inflammation in vivo: it markedly decreases vascular leakage in pleurisy and paw oedema, suggesting that PAF acetylhydrolase might be a useful therapy for severe acute inflammation.