We examined whether freshly isolated human bronchial cells (HBEC) and bronchial epithelial cell line/ BEAS-2B cells expressed surface molecules required for APC function. These cells expressed CD40 and ICAM-1, but not B7-1, B7-2 or HLA-DR molecules. Treatment of these cells with IFN-γ resulted in enhanced expression of CD40 and ICAM-1 as well as induction of HLA-DR expression. Th2 cytokines such as IL-4 and IL-5, proinflammatory cytokine of GM-CSF and nonspecific activator endotoxin had no effect on these phenotypic expressions. Functional examinations showed that allogeneic lymphocytes purified from peripheral blood strongly proliferated in response to BEAS-2B cells cultured with IFN-γ, but only weakly compared with those without IFN-γ. When allogeneic lymphocytes were purified to CD4+ cells, the proliferative response against BEAS-2B cells was abolished. Blockade of CD40-CD40L interaction by anti-CD40 antibody also inhibited the proliferation of lymphocytes to BEAS-2B cells, although this treatment showed a minimum effect on the response to allogeneic MNC. Thus, bronchial epithelial cells have the ability to present allogeneic antigens to T cells in both CD40- and IFN-γ- dependent manners under the presence of third party cells that transduce co-stimulatory signals.