Lysates of peripheral blood T lymphocytes from healthy individuals were found to contain a low molecular-weight peptide that inhibited phytohaemagglutinin-induced DNA synthesis in vitro by autologous or allogeneic peripheral blood mononuclear cells. The peptide was dialysable, partially heat stable, resistant to trypsin, RNase, and DNase but not to pronase, and was not part of the membrane receptor involved in rosette formation by T lymphocytes with sheep erythrocytes. It was found to act through monocytes, inducing the synthesis of second mediator responsible for the inhibition of lymphocyte DNA synthesis. This inducer of inhibition, designated as "low molecular-weight activator of suppressor monocytes' (LASM), may have a role in the depression of cellular immune response seen in various pathological conditions involving the destruction of T lymphocytes.