Although corticosteroids are effective in improving asthma symptoms and bronchial responsiveness, their mechanism of action is unknown. We examined whether changes in bronchial responsiveness with corticosteroid therapy of asthma are accompanied by a reduction in cytokine gene expression and eosinophil infiltration in the airways. Bronchoalveolar lavage (BAL) was performed in 18 patients with moderate asthma before and after 2 wk of treatment with prednisolone, 0.6 mg/kg/day, or matched placebo in a randomized double-blind parallel group study. Cells were counted in BAL cytocentrifuge preparations, and the numbers of cells expressing cytokine mRNA were assessed by in situ hybridization using 35S-labeled RNA probes. When the actively treated and placebo groups were compared, there was a decrease in airway methacholine responsiveness (p < 0.01) after prednisolone. This was accompanied by a decrease in bronchoalveolar lavage eosinophils (p < 0.05), a reduction in the numbers of BAL cells per 1,000 expressing mRNA for interleukin-4 (IL-4, p < 0.01) and interleukin-5 (IL-5, p < 0.005), and an increase in numbers of cells expressing mRNA for interferon-gamma (p < 0.005). These results are compatible with the hypothesis that the beneficial effects of corticosteroids in asthma may result from modulation of cytokine production, with consequent inhibition of local bronchial eosinophilia.