In this study, we present evidence that gene transfer of the CD40-ligand (CD154) into human immature dendritic cells (DC) imparts direct antitumor effects on tumor cells. DC infected with adenovirus directed to express human CD154 on the cell surface (CD154-DC) elicited significantly higher levels of immune accessory molecules commonly found on mature DC. We found that co-cultivation with a human squamous cell carcinoma cell line (OSC-70) with CD154-DC significantly inhibited cell growth. We further demonstrate that OSC-70 cells stimulated with CD154-DC were more susceptible to apoptosis via TNF-related apoptosis inducing ligand (TRAIL). Importantly, tumor cells co-cultured with CD154-DC in transwell plates expressed upregulated cell surface TRAIL-R2. CD154-DC produced higher levels of interferon (IFN)-gamma, IL-12p70 and soluble CD154, but the ability of CD154-DC to inhibit tumor cell growth was significantly abrogated by a neutralizing antibody to IFN-gamma, indicating that this was mainly mediated by IFN-gamma. Furthermore, intratumoral injection of CD154-DC significantly suppressed OSC-70 tumor growth in a xenograft model. Overall, these results reveal that CD154-DC have potential as an anti-cancer therapy by producing IFN-gamma to arrest adjacent tumor cell growth and increase the susceptibility of apoptosis via TRAIL.