FK-506 is a recently discovered immunosuppressive agent that, although structurally quite distinct from cyclosporin A (CsA), shares many of its properties. These include interference with production of interleukin 2 (IL-2) and other lymphokines, lack of myelotoxicity and the induction of transplantation tolerance following administration of short courses to allografted rats. Compared with CsA, however, FK-506 is much more potent and the two agents can act synergistically both in vivo and in vitro. However, severe side effects of FK-506 have been reported in dogs and baboons, although not in rats. On the basis of recently published findings. Angus Thomson reviews the immunological properties of FK-506 and assesses its potential in the light of the impact already made by CsA in both the laboratory and clinic.