Adenosine receptors are present on most cells and organs, yet, although the physiological effects of adenosine were first described over 60 years ago, the potential therapeutic uses of adenosine have only been recognized and realized recently. A decade ago the potent anti-inflammatory effects of adenosine were first described; adenosine, acting at specific A2 receptors, inhibits some, but not all, neutrophil functions. Adenosine inhibits phagocytosis, generation of toxic oxygen metabolites, and adhesion (to some surfaces and to endothelial cells) but does not inhibit degranulation or chemotaxis. Occupancy of adenosine A2 receptors modulates leukocyte function by a novel mechanism. Although adenosine A2 receptors are classically linked to heterotrimeric GS signaling proteins and stimulation of adenylate cyclase, adenosine 3',5'-cyclic monophosphate does not act as the second messenger for inhibition of leukocyte function. By a mechanism that still remains obscure, occupancy of adenosine A2 receptors on neutrophils "uncouples" chemoattractant receptors from their stimulus-transduction proteins. The concentrations of adenosine that inhibit inflammatory cell function are similar to those observed in vivo and suggest a role for adenosine in the modulation of inflammation in vivo. Indeed, recent studies indicate that nonmetabolized adenosine receptor agonists are potent anti-inflammatory agents, and other studies indicate that methotrexate, a commonly used anti-inflammatory agent, diminishes inflammation by increasing adenosine release at inflamed sites. The observations reviewed here suggest that adenosine and agents that act through adenosine are excellent candidates for development as anti-inflammatory agents.