Oxidized cell-free hemoglobin (Hb), including covalently cross-linked Hb multimers, is present in advanced atherosclerotic lesions. Oxidation of Hb produces methemoglobin (Fe(3+)) and ferryl hemoglobin (Fe(4+) = O(2-)). Ferryl iron is unstable and can return to the Fe(3+) state by reacting with specific amino acids of the globin chains. In these reactions globin radicals are produced followed by termination reactions yielding covalently cross-linked Hb multimers. Despite the evanescent nature of the ferryl state, herein we refer to this oxidized Hb as "ferryl Hb." Our aim in this work was to study formation and biological effects of ferrylHb. We demonstrate that ferrylHb, like metHb, can release its heme group, leading to sensitization of endothelial cells (ECs) to oxidant-mediated killing and to oxidation of low-density lipoprotein (LDL). Furthermore, we observed that both oxidized LDL and lipids derived from human atherosclerotic lesions trigger Hb oxidation and subsequent production of covalently cross-linked ferrylHb multimers. Previously we showed that ferrylHb disrupts EC monolayer integrity and induces expression of inflammatory cell adhesion molecules. Here we show that when exposed to ferrylHb, EC monolayers exhibit increased permeability and enhanced monocyte adhesion. Taken together, interactions between cell-free Hb and atheroma lipids engage in a vicious cycle, amplifying oxidation of plaque lipids and Hb. These processes trigger EC activation and cytotoxicity.