Tumor Necrosis Factor (TNF) is a key molecule in lung inflammation. We have established the Insulin-like Growth Factor Binding Protein 2 (IGFBP-2) as a marker associated with the growth arrest of lung alveolar epithelial cells (AEC). Here, we studied the effects of TNF- on AEC proliferation and the putative protective role of retinoic acid (RA). We documented an antiproliferative action of TNF-which was reversible only at 24 h and then became irreversible with induction of apoptosis. TNF-treatment was associated with a dramatic induction of IGFBP-2. To enlighten the mechanism of action of IGFBP-2, we further tested the mitogenic potential of IGF-I to counteract TNF-inhibition. Addition of IGF-I to the TNF-containing medium did not stimulate proliferation, whereas des(1-3)IGF-I, an analog of IGF-I which bears low affinity for IGFBPs, was able to restore cell growth. Interestingly, we observed that RA abrogated TNF- induced-growth arrest, and that this effect was associated with a dramatic decrease in IGFBP-2 expression. These results suggest a protective role of RA from TNF- antiproliferative action, through mechanisms involving modulation of IGFBP-2 production.