Oncostatin-M (OSM), a pluripotent cytokine of the interleukin-6 (IL-6) family, is produced in a number of inflammatory conditions. Known sources of OSM include monocytes–macrophages and T-cells. Here we present microglia, the resident macrophages of the brain, as a source of OSM in the CNS. In this context, we describe a novel inducer of OSM, prostaglandin E₂ (PGE₂). PGE₂ induces OSM expression in microglia, monocytes, and macrophages of human and murine origin. PGE₂ induction of OSM is mimicked by cholera toxin, an activator of stimulatory G (G_s)-proteins; by forskolin, an activator of adenylate cyclase; and by the cAMP analog, dibutyryl-cAMP. PGE₂ induction of OSM gene expression is inhibited by the adenylate cyclase inhibitor 2′,5′-dideoxyadenosine, by the protein kinase A (PKA) inhibitor H-89, and by a dominant-negative PKA construct. These data indicate that PGE₂ signals via G_s-protein-coupled receptor(s), adenylate cyclase, and PKA to induce OSM expression. Accordingly, other activators of cAMP signaling such as norepinephrine and PGE₁ induce OSM. The ability of PGE₂ to induce OSM expression was tested under more physiological conditions, using cocultures of astrocytes and monocytes. Treatment of the cocultures with IL-1β or tumor necrosis factor-α (TNF-α) results in production of PGE₂ and OSM. PGE₂ produced in the cocultures is responsible for OSM induction, because pretreatment with indomethacin, an inhibitor of prostaglandin synthesis, as well as depletion of PGE₂, abrogate OSM expression induced by IL-1β or TNF-α. These data suggest that in the CNS, OSM may be produced through collaboration of astrocytes and macrophages–microglia.