We investigated an outbreak of hemolytic anemia among patients on hemodialysis shortly after the installation of a new water-filtration system. Using in vitro technics, we demonstrated that a water-soluble inhibitor of red-cell metabolism could easily be extracted from the intact filters. Subsequent experiments showed this toxic substance to be formaldehyde, a potent reducing agent whose mechanism of action involves conversion of NAD to NADH. This alteration of the redox state of the erythrocyte leads to inhibition of glycolysis at the level of glyceraldehyde 3-phosphate dehydrogenase and rapid decline in cellular energy (ATP) stores. Because formaldehyde is widely used as a preservative for dialysis equipment, the toxicity of this agent for red blood cells is of clinical importance.