This report demonstrates that Clara cell 10-kDa protein (CC10) mRNA levels are regulated by interferon-gamma (IFN-gamma). An analysis of total lung RNA from mice given IFN-gamma intratracheally showed increased levels of CC10 mRNA compared to control animals but no significant increases in surfactant proteins B and C. These results were confirmed in a Clara cell line, mtCC1-2, generated from the lungs of a transgenic mouse expressing the SV40 large T antigen under the control of a Clara cell-specific promoter. Significant increases in mtCC1-2 CC10 mRNA levels were observed in a time- and a dose-dependent manner. The expression of transacting factors hepatocyte nuclear factors 3 alpha and 3 beta (HNF-3 alpha and HNF-3 beta) were also analyzed, and a transient increase in the expression of HNF-3 beta but not HNF-3 alpha was detected. Deoxyribonuclease I footprint analysis identified a signal transducer and activator of transcription (STAT) binding site (at nucleotides -293 to -284 of CC10) adjacent to two thyroid transcription factor-1 (TTF-1) binding sites, suggesting a potential interaction between STAT1 and TTF-1. This report reinforces the hypothesis that CC10 functions as an anti-inflammatory protein and that increases in CC10 protein may provide additional protection from inflammation and disease in the lung.