Thymoma is known to contain CD4+CD8+ T cells, indicating that neoplastic epithelial cells of thymoma have a function as thymic cortical epithelium. However, it has been shown that there is an impairment of CD4+ T cell development in thymoma and that IFN-gamma-induced HLA-DR expression on cultured thymic epithelial cells (TEC) derived from thymoma is decreased when compared with the normal thymus. MHC class II transactivator (CIITA) is known to play a critical role in IFN-gamma-induced MHC II expression. In this study, we attempted to elucidate whether CIITA is responsible for the impaired up-regulation of MHC II molecules in response to IFN-gamma in thymoma TEC. A quantitative reverse transriptase-polymerase chain reaction examination revealed that the induced level of CIITA was significantly lower in thymoma TEC than in normal TEC. The induced levels of invariant chain (Ii) and HLA-DR in thymoma TEC were correlated with CIITA expression. The proportion of CD3+ cells in the CD4+CD8- subset in thymoma was also correlated with CIITA expression. A gel mobility shift assay however, revealed translocation of STAT1 to the nucleus in thymoma as well as normal TEC. Intercellular adhesion molecule-1 was up-regulated in the thymoma TEC to a level similar to normal TEC in response to IFN-gamma. These results indicate that impaired up-regulation of HLA-DR in response to IFN-gamma results from insufficient induction of CIITA, but not from the signal from IFN-gamma receptor to the nucleus. The abnormal regulation of HLA-DR expression caused by impaired induction of CIITA may affect CD4+ T cell development in thymoma.