The mechanisms leading to asthma, and those guarding against it, are yet to be fully defined. The neuropeptide VIP is a co-transmitter, together with nitric oxide (NO), of airway relaxation, and a modulator of immune and inflammatory responses. NO-storing molecules in the lung were recently shown to modulate airway reactivity, and were proposed to have a protective role against the disease. We report here that mice with targeted deletion of the VIP gene spontaneously exhibit airway hyperresponsiveness to the cholinergic agonist methacholine, as well as peribronchiolar and perivascular cellular infiltrates and increased levels of inflammatory cytokines in broncho-alveolar lavage (BAL) fluid. Immunologic sensitization and challenge with ovalbumin generally enhanced the airway hyperresponsiveness and airway inflammation in all mice. Intraperitoneal administration of VIP over a 2-week period in KO mice virtually eliminated the airway hyperresponsiveness, and reduced the airway inflammation in previously sensitized and challenged mice. The findings suggest that: a) VIP may be an important component of endogenous anti-asthma mechanisms; b) deficiency of the VIP gene may predispose to asthma pathogenesis; and c) treatment with VIP or a suitable agonist may offer potentially effective replacement therapy for this disease.