Current evidence suggests that tumor necrosis factor alpha (TNFalpha) and the family of interferons (IFNs) synergistically regulate many cellular responses that are believed to be critical in chronic inflammatory diseases, although the underlying mechanisms of such interaction are complex, cell-specific, and not completely understood. In this study, TNFalpha in a time-dependent manner activated both janus tyrosine kinase 1 and Tyk2 tyrosine kinase and increased the nuclear translocation of interferon-regulatory factor-1, STAT1, and STAT2 in human airway smooth muscle cells. In cells transfected with a luciferase reporter, TNFalpha stimulated gamma-activated site-dependent gene transcription in a time- and concentration-dependent manner. Using neutralizing antibodies to IFNbeta and TNFalpha receptor 1, we show that TNFalpha-induced secretion of IFNbeta mediated gamma-activated site-dependent gene expression via activation of TNFalpha receptor 1. In addition, neutralizing antibody to IFNbeta also completely abrogated the activation of interferon stimulation response element-dependent gene transcription induced by TNFalpha. Secreted IFNbeta acted as a negative regulator of TNFalpha-induced interleukin-6 expression, while IFNbeta augmented TNFalpha-induced RANTES (regulated on activation normal T cell expressed and secreted) secretion but had little effect on TNFalpha-induced intercellular adhesion molecule-1 expression. Furthermore TNFalpha, a modest airway smooth muscle mitogen, markedly induced DNA synthesis when cells were treated with neutralizing anti-IFNbeta. Together these data show that TNFalpha, via the autocrine action of IFNbeta, differentially regulates the expression of proinflammatory genes and DNA synthesis.