The incubation of murine spleen cells in the lymphokine interleukin 2 (IL 2) gives rise to lymphokine-activated killer (LAK) cells capable of lysing fresh tumor cells in short-term lytic assays. During the course of cultures used to generate LAK cells, cytoplasmic granules were prepared and were analyzed for the presence of the cytolysin previously described in large granular lymphocytes (LGL) and cytotoxic T lymphocytes (CTL). Such cytolysin activity is initially undetectable, appears after 2 days of culture, and continues to increase until day 7. The LAK cytolysin has properties similar to those of previously described cytolysins with respect to nonspecific killing of various target cells, rapid kinetics, and absolute dependence on calcium. Antibodies raised against purified LGL tumor granules neutralized the activity of the LAK cytolysin. The precursors of both the LAK cells and the cells bearing the cytolysin are eliminated by treatment with anti-asialo-GM1 and complement, strongly suggesting that the actual LAK effector cells and the cytolysin-bearing cells are identical. Biochemical analysis of the LAK granules indicate that they contain the lysosomal enzyme arylsulfatase. The protein content of granules isolated from various days of culture with r-IL 2 undergoes a dramatic change, with major protein bands around 30,000 daltons becoming prominent, as well as the cytolysin protein band at 70,000 daltons. These data suggest that the mechanism of cell lysis by LAK cells is similar to that of CTL and natural killer-mediated lysis, and each of these forms of lymphocyte-mediated cytolysis is based on a granule exocytosis mechanism.