The pro-inflammatory effects of IL-1 beta have been linked to the induction of the enzyme COX-2. We now show that in addition to increasing the expression of COX-2, IL-1 beta concomittantly decreased the expression of lipocortin 1 on the surface of A549 cells. Furthermore, cytosolic PLA(2) is concomittantly activated by phosphorylation-resulting in a stimulation of arachidonic acid and PGE(2) release. All of these effects appear to be mediated via a common pathway of PLC and PKC activation. Activation of cPLA(2) is inhibited by dexamethasone in a lipocortin 1-dependent mechanism. We present a novel hypothesis whereby the effects of IL-1 beta are not only due to activation of enzymes necessary for generation of eicosanoids but also to an inhibition of mechanisms that regulate the supply of arachidonic acid. (C) 1996 Academic Press, Inc.