Recent reports demonstrate that peroxisome proliferator-activated receptor gamma (PPAR, a member of the nuclear receptor super-family, acts as a repressor of type I collagen synthesis. Our data demonstrate that exogenously expressed PPARdown-regulates collagen expression in a dose responsive manner in human lung fibroblast cells. Silencing PPAR using lentiviruses expressing ShRNAs partially reverses interferon-gamma (IFN- induced repression and activates collagen mRNA levels. Previous studies indicate that IFN-represses collagen gene expression and induces major histocompatibility complex II (MHC II) expression by activating the formation of a regulatory factor for X-box 5 (RFX5) complex with class II transactivator (CIITA). This paper demonstrates that PPAR[gamma} is within the RFX5/CIITA complex as judged by co-immunoprecipitation and DNA affinity precipitation studies. Most importantly, occupancy of PPARon the collagen transcription start site and MHC II promoter increases with IFNtreatment. The PPARagonist, troglitazone, sensitizes the cells to IFN-treatment by increasing recruitment of PPARto collagen gene while repressing collagen expression and these effects are blocked by the PPARantagonist T0070907. PPARmay mediate IFN--stimulated collagen transcription down-regulation and MHC II up-regulation by interacting with CIITA as well as regulating CIITA expression. Therefore, PPARis a critical target for investigations into therapeutics of diseases involving extra cellular matrix remodeling and the immune response.