The cross-talk between tumour cells and the surrounding supporting host cells (stroma) is a key regulator of cancer growth and progression. By undertaking 2-DE analysis of laser capture microdissected malignant and stromal components of pancreatic tumours and benign ductal elements, we have identified high levels of S100A8 and S100A9 in tumour-associated stroma but not in benign or malignant epithelia. Immunohistochemical analysis (n = 71 patients) revealed strong expression of both proteins in stromal myeloid cells, subsequently identified as CD14(+)/CD68(- )monocytes/macrophages. Co-immunofluorescence revealed that S100A8 was expressed in a subset of S100A9-positive cells. Correlation of the expression of S100A8 and S100A9 to patient parameters revealed that the microenvironments of tumours which lacked expression of the tumour suppressor protein, Smad4, had significantly reduced numbers of S100A8-immunoreactive (p = 0.023) but not S100A9-immunoreactive (p = 0.21) cells. The ratio of S100A8- to S100A9-positive cells within individual tumours was significantly lower in Smad4-negative tumours than in Smad4-positive tumours (p<0.003). Pancreatitic specimens also contained S100A8- and S100A9-expressing cells, although this was not observed in regions displaying extensive fibrosis. In conclusion, our study provides an extensive analysis of S100A8 and S100A9 in pancreatic disease and highlights a potentially important relationship between pancreatic cancer cells and their surrounding microenvironment.