The environmental contaminant 2,3,7,8-tetrachlorodibenzo-p-dioxin (TCDD) and the corticosteroid dexamethasone have potent effects on lymphocyte function, although the effects of the former have not been well characterized. In the present studies murine B cell maturation was used as a model system to examine and compare the effects of TCDD and dexamethasone on cell function. Immunosuppression by TCDD and dexamethasone is mediated by binding to specific intracellular R referred to as the Ah and glucocorticoid R, respectively. Although both compounds were comparable in their ability to inhibit antibody responses to the T-independent antigen TNP-LPS, the events responsible for suppression were found to be distinct. Dexamethasone, although affecting multiple stages of B cell maturation, had its primary effect very early, manifested by inhibition of the phosphoinositide signal transduction pathway. This was evidenced by a decrease in accumulation of inositol phosphate and surface Ia antigen expression as well as an inability to enter the cell cycle after stimulation with anti-Ig. In contrast, neither early signaling events nor proliferation were affected in B cells treated with TCDD. However, TCDD inhibited Ig secretion after stimulation of B cells with T cell-replacing factor, suggesting that TCDD modulates the differentiation of B cells into plasma cells. These differential results were confirmed by monitoring the expression of surface antigens that occur on B cells, including Ia, 7D4, and PC.2, during this maturational process. Whereas dexamethasone inhibited the expression of surface antigens that occur early in maturation (Ia and 7D4), TCDD blocked only the expression of the plasma cell marker PC.2. Although TCDD altered later stages of the B cell cycle, the presence of TCDD was required at the time of initial activation to be effective, suggesting that TCDD may interfere with early cell programming.