The inflammatory response as seen in human allergic asthma is thought to be regulated by Th2 cells. It has been shown that interferon-γ (IFN-γ) can downregulate the proliferation of Th2 cells and therefore might be of therapeutic use. In the present study we have investigated the in vivo role of endogenous and exogenous IFN-γ in a murine model with features reminiscent of human allergic asthma. IFN-γ gene knockout (GKO) and wild-type mice were sensitized with ovalbumin and exposed to repeated ovalbumin aerosol challenges. In addition, wild-type mice were treated with intraperitoneal or nebulized recombinant murine IFN-γ during the challenge period. Sensitized wild-type mice exhibited upregulated ovalbumin-specific IgE in serum, and airway hyperresponsiveness and infiltration of eosinophils and mononuclear cells in the bronchoalveolar lavage fluid (BALF) after ovalbumin challenge. In contrast, in GKO mice only reduced eosinophilic infiltration in the BALF was observed after ovalbumin challenge. In wild-type mice, parenteral IFN-γ treatment downregulated ovalbumin-specific IgE levels in serum, and airway hyperresponsiveness and cellular infiltration in the BALF, whereas aerosolized IFN-γ treatment only suppressed airway hyperresponsiveness. In vitro experiments showed that these effects of IFN-γ appear not to be mediated via a direct effect on the cytokine production of antigen-specific Th2 cells. These data indicate that airway hyperresponsiveness can be downregulated by IFN-γ locally in the airways, whereas for downregulation of IgE and cellular infiltration systemic IFN-γ is needed. The present study shows that exogenous IFN-γ can downregulate the allergic response via an antigen-specific T-cell independent mechanism, but at the same time endogenous IFN-γ plays a role in an optimal response.