Lymphokine activated killer (LAK) cells represent mixtures of natural killer (NK) and non-MHC-restricted CTLs that have the capacity to lyse a variety of tumor cells and MHC class I-negative target cells. Although it is clear that NK cells are negatively regulated by interactions with MHC class Ia or class Ib molecules, the regulation of LAK-derived T cells has not been clarified to date. In the studies presented here, we demonstrate that IFN-gamma treatment of tumor cells can induce their resistance to LAK-derived T cells in a manner similar to that seen for NK cells. The IFN-gamma-mediated suppression of LAK activity correlates with increased MHC class I expression by the tumor cells, and the inhibition of LAK-mediated cytotoxicity can be reversed in the presence of class I-specific antibody. Furthermore, the expression of MHC class Ia or class Ib molecules in class I-negative cell lines can reduce their susceptibility to LAK-mediated cytotoxicity. This principle of negative regulation by MHC class I molecules applies to LAK-derived T cells generated from peripheral blood lymphocytes of renal cell carcinoma patients and healthy, control donors. Although LAK-derived T cells can be inhibited in their lytic activity through interactions with MHC class Ia and class Ib molecules, they do not express the known inhibitory receptors specific for these ligands that are found on NK cells. Apparently, LAK-derived T cells are negatively regulated by as yet undefined inhibitory receptors.