Natural killer cell activity and related cell surface markers of peripheral blood lymphocytes were studied in 73 patients with multiple myeloma, 25 with monoclonal gammopathy of undetermined significance and 20 normal controls. Natural killer cell number was significantly higher in both multiple myeloma and monoclonal gammopathy patients than in controls, whereas the natural killer activity of multiple myeloma patients was inversely related to their disease status. Incubation of peripheral blood lymphocytes or natural killer cells with IgG myeloma proteins purified from several patients induced a down-modulation of basic natural killer activity. This inhibitory effect of monoclonal IgG was dose dependent and significantly stronger in patients with active (at diagnosis and at relapse) than stable multiple myeloma or in normal controls. Addition of exogenous recombinant interleukin-2 restored natural killer cell activity against K562 target cells, indicating that natural killer cells were able to recover their functions. However, recombinant interleukin-2-stimulated natural killer cells were responsive to down-modulation of monoclonal IgG. These data suggest that impaired natural killer cell function in active multiple myeloma is caused by the inhibitory effect of M-component.