IL-1F7 was discovered in expressed sequence tag databases as a member of the increasing family of proteins sharing sequence homology to IL-1alpha/beta, IL-1Ra, and IL-18. In the present study using immunohistochemical staining, IL-1F7 was localized in human peripheral monocytic cells, suggesting its role in immune regulation. Recombinant human IL-1F7b was shown to bind to the IL-18Ralpha but without IL-18 agonistic or antagonistic function. Using chemical cross-linking, we observed that, unlike IL-18, IL-1F7b fails to recruit the IL-18Rbeta chain to form a functionally active, ternary complex with the IL-18Ralpha chain. IL-1F7b shares two conserved amino acids with IL-18 (Glu-35 and Lys-124), which participate in the interaction of IL-18 with the IL-18Ralpha chain as well as the IL-18-binding protein (IL-18BP), a secreted protein that neutralizes IL-18 activity. In testing whether IL-1F7b interacts with IL-18BP, we unexpectedly observed that IL-1F7b enhanced the ability of IL-18BP to inhibit IL-18-induced IFNgamma by 25-30% in a human natural killer cell line. This effect was observed primarily at limiting concentrations of IL-18BP (3.12-12.5 ng/ml) and at a 50- to 100-fold molar excess of IL-1F7b. Similar results were obtained by using isolated human peripheral blood mononuclear cells. To study the molecular basis of this effect we performed binding studies of IL-1F7b and IL-18BP. After cross-linking, a high molecular weight complex consisting of IL-1F7b and IL-18BP was observed on SDS/PAGE. We propose that after binding to IL-18BP, IL-1F7b forms a complex with IL-18Rbeta, depriving the beta-chain of forming a functional receptor complex with IL-18Ralpha and thus inhibiting IL-18 activity.