The structurally related neuropeptides VIP and PACAP are released within the lymphoid organs following antigenic stimulation, and modulate the function of inflammatory cells through specific receptors. In activated macrophages, VIP and PACAP inhibit the production of pro-inflammatory agents (cytokines, chemokines, and nitric oxide), and stimulate the production of the anti-inflammatory cytokine IL-10. These events are mediated through the VIP/PACAP effects on de novo expression or nuclear translocation of several transcription factors, i.e., NFkappaB, CREB, c-Jun, JunB, and IRF-1. The in vivo administration of VIP/PACAP results in a similar pattern of cytokine and chemokine modulation, which presumably mediates the protective effect of VIP/PACAP in septic shock. In addition, VIP/PACAP reduce the expression of the co-stimulatory molecules B7.1/B7.2, and the subsequent stimulatory activity of macrophages for T-helper cells. In T-cells expressing specific VIP/PACAP receptors, VIP and PACAP inhibit the expression of FasL through effects on NFkappaB, NFAT, and Egr2/3. The reduction of FasL expression has several biological consequences: inhibition of antigen-induced cell death in CD4 T-cells, inhibition of the FasL-mediated cytotoxicity of CD8 and CD4 effectors against direct and bystander targets, and promotion of long-term memory Th2 cells, through a positive effect on the survival of Th2, but not Th1, effectors. The various biological effects of VIP and PACAP are discussed within the range of a general anti-inflammatory model.