Accumulating evidence has emphasized the importance of immunocompetent cells in determining the psoriatic phenotype. We have investigated the effect of 1α,25-dihydroxycholecalciferol, the naturally occurring active form of vitamin D₃, cyclosporine A, and interleukin-10 on the phenotype of human psoriatic skin xenotransplants. First, psoriatic skin transplants were injected with either 1α,25-dihydroxy- cholecalciferol, cyclosporine A, or interleukin-10. Second, we determined the ability of autologous lymphocytes, activated in vitro using staphylococcal enterotoxin B and interleukin-2 and then exposed to either 1α,25-dihydroxycholecalciferol or cyclosporine A, to induce psoriatic lesions if they were injected into the dermis of uninvolved skin grafts. We found that injections into transplanted psoriatic plaques of either 1α,25-dihydroxycholecalciferol or cyclosporine A, but not interleukin-10, resulted in a consistent reduction in the clinical and histologic score of psoriasis with remission towards uninvolved psoriatic skin. Injection of activated immunocytes into symptomless psoriatic skin grafts, changed the grafts towards plaque-type psoriasis with silvery scale, parakeratosis, elongated rete pegs, acanthosis, and dermal angiogenic reaction. In contrast, if activated immunocytes were exposed to 1α,25-dihydroxycholecalciferol or cyclosporine A prior to injection, only minimal changes occurred. It was determined that neither staphylococcal enterotoxin B and interleukin-2 activation by itself, nor the drugs investigated, changed the CD4/CD8 ratio of activated (CD25 +) cells. Our results are consistent with the hypothesis that psoriasis may be induced by activated T lymphocytes, and indicate that novel immunomodulatory drugs can serve to inhibit the pathogenetic ability of immunocytes in psoriasis.