Variability in the structure of the human tumor necrosis factor (TNF-α) or lymphotoxin (TNF-β) genes may contribute to the functional polymorphism of the HLA gene complex. We have characterized an allelic restriction fragment length polymorphism (RFLP) of the TNF-β gene by using the restriction endonuclease NcoI. Digestion of genomic DNA with NcoI and Southern blotting by using TNF-α gene probes show 5.4-kb and 10.5-kb hybridizing fragments. In Caucasian populations, the 10.5-kb fragment is present in 64 to 72% of haplotypes. The polymorphic NcoI site is located within the first intron of the TNF-β gene. Additional restriction fragment variability was demonstrated by digestion with AccI; however, this restriction fragment variability was not allelic in nature. Rather, it was a consequence of variable DNA methylation at AccI sites within and upstream of the TNF-β gene. In peripheral blood leukocytes, methylation of the TNF-β AccI sites was greatest in neutrophils (TNF-β nonproducers), and lowest in T lymphocytes (the major producers of TNF-β). These results suggest strongly that variation in DNA methylation may play an important role in regulation of the expression of the TNF-β gene.