The Müller cell is the major glial element of the mammalian retina. It can be induced to express MHC class II determinants in culture, when exposed to supernatant from activated lymphocytes. In an in vitro co-culture system, Müller cells had been shown to exert a profound inhibitory influence on Ag- and IL-2-driven proliferation of Th cell lines. In the present report we demonstrate that Müller cells can produce IL-1 activity, and that in conditions where their inhibitory action is suppressed, they display the capacity to efficiently function as APC. Mildly trypsinized and glutaraldehyde-fixed Müller cells that had been preincubated with Ag and IFN-gamma-containing rat spleen conditioned medium were able to present Ag to an S-Ag specific Th lymphocyte line, which has the capacity to induce a severe uveoretinitis in rats. Addition of the Ag after fixation did not result in presentation, showing that Müller cells had to process the nominal Ag into an immunogenic form. It was also found that the efficiency of presentation was greatly increased in the presence of naive syngeneic or allogeneic accessory cells. This enhancing effect could not be reproduced with rIL-1. This report extends our ongoing study of interactions between the retinal glial Müller cell and T lymphocytes. The results show that these interactions can be diverse, even opposite in different conditions, and suggest the possibility that Müller cells could play a determining role in the course of immune reactions at the level of the neuro-retina.