Tumor necrosis factor (TNF)-alpha is produced by macrophages and other cells, and is believed to participate in granulomatous inflammation. Targeted antagonism of TNF-alpha has been proposed as a novel treatment strategy for sarcoidosis. Etanercept is a dimeric fusion protein that binds specifically to TNF-alpha, rendering it biologically inactive. To assess whether etanercept has potential efficacy in the treatment of progressive pulmonary sarcoidosis. Prospective, open-label, phase-2 treatment trial. Mayo Clinic, Rochester, MN. Stage II or III progressive pulmonary sarcoidosis. Etanercept, 25 mg subcutaneously twice weekly. Pulmonary function, chest radiographs, dyspnea, and TNF-alpha levels in serum and BAL fluid. The study was terminated after the enrollment of 17 patients due to an early-stop clause of the pretrial study design related to excessive treatment failures. Neither absolute levels of TNF-alpha nor TNF-alpha activity in the serum, BAL fluid, or alveolar macrophages were able to predict which patients would respond to etanercept. In patients with progressive stage II or III pulmonary sarcoidosis, etanercept was frequently associated with early or late treatment failure. These data would not support the design of a large multicenter randomized trial comparing etanercept with conventional corticosteroid therapy.