Interferon (IFN)-alpha is the most frequently used cytokine in the treatment of diseases of the gastrointestinal tract. This cytokine has emerged as an important regulator of growth and differentiation, affecting cellular communication and immunologic control. The efficacy of IFN-alpha has been shown in many different diseases of viral, malignant, angiogenic, allergic, inflammatory, and fibrotic origin. Cytokines are pleiotropic molecules with a wide variety of biological functions on various cells and tissues, and several different cytokines exert similar and overlapping functions on certain cells. Originally described as an antiviral substance, the role of IFN-alpha as an immunoregulatory molecule has long been ignored. Recent data suggest that IFN-alpha is a multifunctional immunomodulatory cytokine with profound effects on the cytokine cascade including several anti-inflammatory properties. These newly identified immunoregulatory and anti-inflammatory functions may be of importance in the treatment of diseases such as chronic viral hepatitis and help to explain some of the IFN mechanisms.