Interleukin-1 (IL-1) and transforming growth factor alpha (TGF alpha) mRNA expression was analyzed in cultured normal human keratinocytes. Keratinocytes constititively express IL-1 mRNA when cultured in keratinocyte growth medium but not in Dulbecco's minimal essential medium containing fetal bovine serum, in which the cells differentiate. The predominant form of IL-1 expressed by keratinocytes is IL-1 alpha. Addition of IL-1 alpha to keratinocytes increased IL-1 alpha and TGF alpha mRNA expression in a dose-dependent manner. TGF alpha induced a similar increase in IL-1 alpha and TGF alpha mRNA in keratinocytes. Hydrocortisone decreased the expression of both IL-1 alpha and TGF alpha mRNA in keratinocytes. These findings document an autocrine mechanism by which IL-1 alpha and TGF alpha can stimulate the proliferation of keratinocytes in the skin. It is proposed that this autocrine loop may be hyperactive in psoriasis. Antagonism of the effects of this autocrine loop may be one of the mechanisms by which glucocorticoids exert clinically useful effects in psoriasis and other diseases of the skin.