Restoration of the impaired balance between pro- and antiinflammatory cytokines should provide effective treatment of rheumatoid arthritis. Gene therapy has been proposed as an approach for delivery of therapeutic proteins to arthritic joints. Here, we examined the efficacy of antiinflammatory gene therapy in bacterial cell wall-induced arthritis in rats. Human secreted interleukin 1 receptor antagonist (sIL-1ra) was expressed in joints of rats with recurrent bacterial cell wall-induced arthritis by using ex vivo gene transfer. To achieve this, primary synoviocytes were transduced in culture with a retroviral vector carrying the sIL-1ra cDNA. Transduced cells were engrafted in ankle joints of animals prior to reactivation of arthritis. Animals in control groups were engrafted with synoviocytes transduced with lacZ and neo marker genes. Cells continued to express transferred genes for at least 9 days after engraftment. We found that gene transfer of sIL-1ra significantly suppressed the severity of recurrence of arthritis, as assessed by measuring joint swelling and by the gross-observation score, and attenuated but did not abolish erosion of cartilage and bone. The effect of intraarticularly expressed sIL-1ra was essentially local, as there was no significant difference in severity of recurrence between unengrafted contralateral joints in control and experimental groups. We estimate that locally expressed sIL-1ra was about four orders of magnitude more therapeutically efficient than systemically administered recombinant sIL-1ra protein. These findings provide experimental evidence for the feasibility of antiinflammatory gene therapy for arthritis.