Glucocorticoids (GC) are highly effective in the control of diseases associated with T cell activation. However, a subset of individuals is GC insensitive. Previous studies have demonstrated that IL-2 can induce steroid resistance in mouse T cells. However, the mechanism for this phenomenon is unknown. In the current study we found that the murine cell line (HT-2) is steroid resistant when incubated with IL-2, but steroid sensitive when grown in IL-4. Furthermore, when HT-2 cells are treated with IL-2, the glucocorticoid receptor (GCR) does not translocate to the cell nucleus after dexamethasone treatment. In contrast, the GCR in IL-4-stimulated HT-2 cells does translocate into the cell nucleus after dexamethasone treatment. IL-2-induced steroid insensitivity in HT-2 cells appears to be a signaling event as the effects of IL-2 on nuclear translocation of the GCR occurred within 30 min even in the presence of cycloheximide. Indeed, preincubation of HT-2 cells with a Janus-associated kinase 3 inhibitor restored nuclear translocation of the GCR even in the presence of IL-2. Immunoprecipitation experiments revealed that phosphorylated STAT5 and GCR formed immune complexes. This association may lead to retardation of GCR nuclear translocation because IL-2 was not able to induce steroid insensitivity in splenocytes from STAT5 knockout mice. This study demonstrates a novel role for STAT5 in IL-2-induced steroid insensitivity.