Activated hepatic stellate cells (HSC) participate in matrix remodeling and deposition in liver fibrosis. The present study demonstrates that interleukin (IL)-10 is expressed by HSC upon activation in vitro or in vivo and that autocrine effects of this cytokine include inhibition of collagen production. Culture activation of HSC caused a distinct increase in IL-10 mRNA level compared with freshly isolated quiescent HSC. Treatment of cultured HSC with tumor necrosis factor-alpha, transforming growth factor-beta, or lipopolysaccharide further increased IL-10 mRNA by 2-fold and resulted in the release of IL-10 protein into the medium. HSC isolated from rats after bile duct ligation (BDL) showed prominent increases in IL-10 mRNA (x 100) and protein (x 30) levels at 7 days after BDL, but such induction disappeared in advanced liver fibrosis (19 days after BDL). IL-10 expression correlated positively with mRNA expression of interstitial collagenase and inversely with that of alpha1(I) collagen. Addition of anti-IL-10 IgG to cultured HSC caused enhanced collagen production under a basal or stimulated condition with TGF-beta, tumor necrosis factor-alpha, or lipopolysaccharide. These effects were associated with increased alpha1(I) collagen mRNA and reciprocally reduced collagenase mRNA levels. Co-transfection of HSC with an IL-10 expression vector and collagen reporter genes showed a 40% inhibition of alpha1(I) collagen promoter activity. These results demonstrate that activation of HSC causes enhanced autocrine expression of IL-10 which possesses a negative autoregulatory effect on HSC collagen production mediated at least in part by alpha1(I) collagen transcriptional inhibition and stimulation of collagenase expression. These findings, along with the demonstrated early induction of HSC IL-10 expression and its late disappearance during biliary liver fibrosis, suggest its in vivo role in matrix remodeling and a possibility that failure for HSC to sustain IL-10 expression underlies pathologic progression to liver cirrhosis.