We have expressed the CD40 surface Ag as both a soluble 28-kDa molecule and a 57-kDa Fc fusion protein containing the human IgG1 Fc region. Soluble CD40 and the Fc fusion protein inhibited the proliferative response of anti-IgM-activated human B cells to the CD40 mAb G28-5. Similarly, G28-5- and IL-4-induced IgE secretion from PBMC depleted of T cells was effectively blocked by both forms of soluble CD40. Although the soluble constructs of CD40 had only a minimal inhibitory effect on IL-4-mediated proliferation of anti-IgM-activated B cells, IL-4-induced soluble CD23 shedding from both PBMC and T cells depleted of PBMC, and IgE secretion from PBMC, were significantly reduced in a concentration-dependent manner when soluble CD40 was present in the culture. The data presented demonstrate that both soluble forms of the CD40 molecule are biologically active, and suggest that the ligand for CD40 is inducible in IL-4-stimulated cultures and that it mediates both shedding of sCD23 and IgE secretion.