Tissue hypoxia is intimately associated with chronic inflammatory disease and may signal to the resolution of inflammatory processes. Glucocorticoid signaling through the glucocorticoid receptor (GR) represents a clinically important endogenous anti-inflammatory pathway. Microarray analysis reveals that the GR is transcriptionally up-regulated by hypoxia in human renal proximal tubular epithelial cells. Hypoxic up-regulation of the GR was confirmed at the level of promoter activity, mRNA, and protein expression. Furthermore, functional potentiation of glucocorticoid activity in hypoxia was observed as an enhancement of dexamethasone-induced glucocorticoid response element promoter activity and enhanced dexamethasone-mediated inhibition of IL-1β-stimulated IL-8 expression and hypoxia-induced vascular endothelial growth factor expression. Knockdown of enhanced GR gene expression in hypoxia using specific GR small inhibitory RNA (siRNA) resulted in an attenuation of the enhanced glucocorticoid sensitivity. A role for the hypoxia-inducible transcription factor, HIF-1α, in the regulation of GR expression and the associated potentiation of glucocorticoid activity in hypoxia was also demonstrated. These results reveal a novel signaling aspect responsible for the incorporation of hypoxic and glucocorticoid stimuli, which we hypothesize to be an important co-operative pathway for the control of gene expression observed in complex tissue microenvironments in inflamed states.