We examined the role of TGF-beta in the inhibitory effects of negatively charged liposomes composed of phosphatidylserine (PS-liposomes) on nitric oxide (NO) production by macrophages stimulated with LPS. The expression of TGF-beta mRNA increased when mouse peritoneal macrophages were treated with PS-liposomes. The inhibitory effect of PS-liposomes on NO production was restored by treatment with anti-TGF-beta antibody. Furthermore, NO production, iNOS mRNA expression, and iNOS protein induction by LPS were inhibited by treatment of macrophages with TGF-beta as well as PS-liposomes. These results indicated that PS-liposomes down-regulate NO production by macrophages through the induction of TGF-beta and suggested that TGF-beta may suppress NO production upstream of the transcription of iNOS mRNA.