Lipoteichoic acid (LTA), a component of the membrane of gram-positive bacteria, induces an isoform of nitric oxide (NO) synthase (iNOS) in vascular smooth muscle; this process may be associated with the vascular failure observed in gram-positive septic shock. The aim of the present work was to study the cellular mechanisms involved in the induction of NO synthesis by LTA from Staphylococcus aureus in cultured rat vascular smooth muscle cells. LTA induces the gene expression of iNOS and GTP cyclohydrolase I (GTPCH) as well as the formation of NO and tetrahydrobiopterin (BH4), effects which are synergistic with interferon-γ. 2,4-Diamino-6-hydroxypyrimidine (DAHP), a selective inhibitor of GTPCH, inhibits both the increase in cellular levels of BH4 as well as the concomitant formation of NO caused by LTA in combination with interferon-γ. This inhibition by DAHP is reversed by co-addition of sepiapterin which is a substrate for BH4 synthesis. Thus, BH4 synthesis is an absolute requirement for the induction of NO synthesis by LTA in vascular smooth muscle. Our findings also suggest that interrupting pterin synthesis may be an effective target for pharmacologic interventions aimed at limiting NO overproduction in gram-positive shock.