Thalidomide reduces IL-18, IL-8 and TNF-alpha release from alveolar macrophages in interstitial lung disease. Thalidomide exhibits diverse actions of anti-inflammation, immunomodulation and anti-angiogenesis. The efficacy of thalidomide treatment in sarcoidosis with lupus pernio is thought to be due to inhibition of tumour necrosis factor (TNF)-alpha. The mechanisms that underlie the properties of thalidomide are still unclear in interstitial lung disease. The current authors investigated the potential inhibitory effects of thalidomide at concentrations of 0.1, 0.01 and 0.001 mM on the production of transforming growth factor-beta, TNF-alpha, interleukin (IL)-1beta, IL-6, IL-8, IL-10, IL-12p70, IL-12p40 and IL-18 by alveolar macrophages from bronchoalveolar lavage in patients with sarcoidosis (n = 8), hypersensitivity pneumonitis (HP; n = 8) and idiopathic pulmonary fibrosis (IPF; n = 12). In sarcoidosis and HP patients, thalidomide induced a dose-dependent, partial suppression of lipopolysacchride (LPS)-stimulated TNF-alpha, IL-12p40 and IL-18 release. At the highest thalidomide concentration (0.1 mM), LPS-stimulated IL-8 production was also suppressed. In IPF patients, although spontaneous production of TNF-alpha, IL-12p40, IL-18 and IL-8 was lower than in sarcoidosis and HP patients, with LPS stimulation the cytokines were significantly elevated and also partially inhibited by thalidomide. In conclusion, thalidomide has the potential to improve the therapeutic regimens for sarcoidosis, hypersensitivity pneumonitis and idiopathic pulmonary fibrosis by reducing tumour necrosis factor-alpha, interleukin-12p40, interleukin-18 and interleukin-8 production.