Glutathione (GSH) is an important physiological antioxidant in lung epithelial cells and lung lining fluid. We studied the regulation of GSH synthesis in response to the pro-inflammatory cytokine tumor necrosis factor-alpha (TNF-alpha) and the anti-inflammatory agent dexamethasone in human alveolar epithelial cells (A549). TNF-alpha (10 ng/ml) exposure increased GSH levels, concomitant with a significant increase in gamma-glutamylcysteine synthetase (gamma-GCS) activity and the expression of gamma-GCS heavy subunit (gamma-GCS-HS) mRNA at 24 h. Treatment with TNF-alpha also increased chloramphenicol acetyltransferase (CAT) activity of a gamma-GCS-HS 5'-flanking region reporter construct, transfected into alveolar epithelial cells. Mutation of the putative proximal AP-1-binding site (-269 to -263 base pairs), abolished TNF-alpha-mediated activation of the promoter. Gel shift and supershift analysis showed that TNF-alpha increased AP-1 DNA binding which was predominantly formed by dimers of c-Jun. Dexamethasone (3 microM) produced a significant decrease in the levels of GSH, decreased gamma-GCS activity and gamma-GCS-HS mRNA expression at 24 h. The increase in GSH levels, gamma-GCS-HS mRNA, gamma-GCS-HS promoter activity, and AP-1 DNA binding produced by TNF-alpha were abrogated by co-treating the cells with dexamethasone. Thus these data demonstrate that TNF-alpha and dexamethasone modulate GSH levels and gamma-GCS-HS mRNA expression by their effects on AP-1 (c-Jun homodimer). These data have implications for the oxidant/antioxidant balance in inflammatory lung diseases.