Alveolar macrophages activated with concanavalin A and peripheral blood monocytes activated with lipopolysaccharide secrete type beta transforming growth factor (TGF-beta). There is minimal TGF-beta secretion in unactivated monocytes, even though TGF-beta mRNA is expressed in these cells at a level similar to that in activated, lipopolysaccharide-treated cultures. U937 lymphoma cells, which have monocytic characteristics, also express mRNA for TGF-beta. Freshly isolated monocytes, both control and lipopolysaccharide-treated, secrete an acid-labile binding protein that inhibits TGF-beta action. We conclude the following: (i) that expression of TGF-beta mRNA is unrelated to monocyte activation, (ii) that secretion of TGF-beta is induced by monocyte activation, and (iii) that cosecretion of TGF-beta and its monocyte/macrophage-derived binding protein may modulate growth factor action. In contrast, monocytic expression of other growth factor genes, such as the B chain of platelet-derived growth factor, is not constitutive and requires activation.