The effects of recombinant rat interferon-gamma (rRaIFN-gamma) and rat IFN (RaIFN, a mixture of IFN-gamma and -alpha) on basal and FSH-induced ovarian granulosa cell function were studied. Granulosa cells were harvested from diethylstilboestrol-treated immature rats and cultured (2 x 10(5) viable cells/well per 0.5 ml) in serum-free medium with or without treatment for 48 h. In the presence of FSH (20 ng/ml), rRaIFN-gamma (10-1000 U/ml) significantly inhibited FSH-stimulated aromatase activity (76.4 +/- 2.3% maximum inhibition compared with FSH treatment alone), inhibin (40.4 +/- 3.7%), progesterone (47.7 +/- 8.6%) and 20-alpha-hydroxypregn-4-en-3-one (20-alpha-OHP) (51.8 +/- 1.7%) production in a dose-dependent manner. Furthermore, rRaIFN-gamma inhibited FSH- and forskolin (FSK; 30-mu-mol/l)-induced extracellular cAMP accumulation (46.0 +/- 6.6% and 29.1 +/- 7.3% respectively). The inhibitory effect of rRaIFN-gamma on FSK-induced cAMP was accompanied by decreased FSK-induced aromatase activity, inhibin, progesterone and 20-alpha-OHP production. rRaIFN-gamma had no detectable effect on aromatase activity, progesterone production and 20-alpha-OHP production in the absence of FSH, but significantly stimulated basal inhibin production by 1.5-fold. rRaIFN-gamma alone also caused a small but significant increase in basal levels of cAMP. The time-course studies showed that FSH-induced aromatase activity and inhibin production were consistently suppressed by rRaIFN-gamma, FSH-induced progesterone and 20-alpha-OHP were inhibited at 1 and 2 days and then stimulated on days 3, 4 and 5 relative to FSH alone. There was no difference in DNA content between treatment and non-treatment wells during 5 days of culture. RaIFN had similar effects to rRaIFN-gamma. We conclude that IFN-gamma can inhibit FSH-induced granulosa cell differentiation and that, in the absence of FSH, IFN-gamma stimulated undifferentiated granulosa cells to produce more inhibin. The mechanism of its action is likely to involve changes in cAMP production.