The aim of this study was to assess the side effects and the efficacy of thalidomide alone or in combination with dexamethasone in relapsed multiple myeloma (MM) and to evaluate possible predictive factors for response rate and survival. Twenty-nine pretreated patients were enrolled, including 13 patients with a relapse after high-dose chemotherapy. The median number of relapses was 3 (range: 1-7). Twenty-two patients received thalidomide in combination with dexamethasone and seven patients thalidomide alone. The dosage of thalidomide was 400 mg/day and the dosage of dexamethasone 20 mg/m2 daily for 4 consecutive days every 3 weeks. Cycles of dexamethasone were given until maximal decline of myeloma protein was achieved, whereas therapy with thalidomide was maintained until disease progression. Responses occurred in 62% of patients, including 5 (17%) complete remissions and 13 (45%) partial remissions. The median event-free survival (EFS) was 7.2 months and the median overall survival (OS) 26.1 months. In multivariate analysis, pretreatment serum levels of soluble interleukin-2 receptor (sIL-2R) were a significant prognostic factor for EFS, and those of beta2-microglobulin (beta2M) and sIL-2R for OS. Serum levels of sIL-2R significantly increased after 3 weeks of treatment in 89% of patients, possibly representing lymphocyte activation induced by thalidomide. Two patients died of septic complications within 3 months after starting treatment with thalidomide and dexamethasone and one patient of herpes encephalitis after 26 months of treatment with thalidomide alone. Also, one case of pneumonia and one case of deep venous thrombosis of the lower limb occurred. Other side effects were somnolence, peripheral neuropathy, and bradycardia occurring in 35, 55, 38 and 55% of patients, respectively. The combination of thalidomide and dexamethasone is an effective therapy in heavily pretreated myeloma patients with a high response rate and acceptable toxicities. A powerful predictive factor both for EFS and OS was the pretreatment serum level of sIL-2R.