Prostaglandins, especially PGE2 and PGI2, appear to participate in the development of inflammatory reactions. While these PGs may act to promote inflammation, they may also inhibit immune reactions; this effect is largely related to stimulation of adenylate cyclase. Human rheumatoid synovial tissue explants and derived adherent synovial cells (ASC) in vitro produce large amounts of PG, primarily PGE2, which may participate in the pathogenesis of rheumatoid inflammation and promote the osteoclastic resorption of juxtaarticular bone. Rheumatoid synovial organ cultures are unusual in that they derive a significant proportion of archidonic acid substrate for the PGE2 synthesis from triglycerides, while ASC utilize primarily phospholipids. Aspirin-like, nonsteroidal anti-inflammatory drugs inhibit PGE2 synthesis by rheumatoid synovial organ cultures at concentrations similar to those achieved in plasma during therapy. Glucocorticoids are also potent inhibitors of PGE2 synthesis, and evidence from experiments with tissue labeled with 1-[14C] arachidonic acid indicates that glucocorticoids do not act to inhibit arachidonic acid release, as has been postulated for other tissues. Human peripheral blood mononuclear cells produce a factor (MCF) that regularly stimulates the production of PGE2 and collagenase from resting ASC often by over 100-fold. The MCF appears to be produced by monocytes, and its production by monocytes is enhanced by lectin-stimulated T-cells. The ability of ASC to respond to exogenous PGE2 stimulation of cAMP synthesis is inhibited or stimulated by factors that increase or decrease PGE2 levels, respectively, in the cultures. The MCF augments the responsiveness of cAMP response to PGE2 in indomethacin-treated cultures. These in vitro experiments suggest that the pathogenesis of rheumatoid inflammation involves interactions between monocyte-macrophages, lymphocytes, and synovial cells regulating the production of PGE2, cAMP, and other factors.