Bacterial lipopolysaccharide (LPS) and other immunostimulants induce an isoform of nitric oxide synthase (iNOS) gene expression in vascular smooth muscle cells (VSMC). This process is dependent on nuclear factor-kappa B (NF-kappaB) activation and is suppressed by glucocorticoids. The aim of this study was to investigate the molecular mechanisms of inhibition of iNOS expression by the synthetic glucocorticoid, dexamethasone (DEX), in rat VSMC. Treatment of VSMC with LPS plus interferon-gamma (LPS/IFN) caused activation of NF-kappaB and the iNOS promoter. LPS/IFN induced iNOS mRNA and NO synthesis. DEX markedly depressed LPS/IFN-stimulated iNOS mRNA expression and NO production. DEX also suppressed LPS/IFN-stimulated activity of a 1.7-kb iNOS promoter, indicating that the inhibition of iNOS expression by DEX occurs at the level of transcription. NF-kappaB activation by LPS/IFN was repressed by DEX. The inhibition of NF-kappaB by DEX exhibited dose-dependent kinetics, which corresponded to DEX suppression of iNOS promoter activation, iNOS mRNA expression, and NO production. However, activation of activator protein-1 (AP-1), which is also contained in the iNOS promoter, was not enhanced by LPS/IFN or inhibited by DEX. Thus, glucocorticoids appear to block iNOS expression, at least in part, through inhibition of NF-kappaB activation, which results in decreased NO production.