The control of IL-10 production and mechanisms that mediate synergy between IFN-gamma and TLR ligands are not well understood. We report that IFN-gamma augments induction of TNFalpha by TLR ligands, immune complexes, and zymosan by suppressing IL-10 production and thereby interrupting Stat3-mediated feedback inhibition. IFN-gamma altered TLR2-induced signal transduction by increasing GSK3 activity and suppressing MAPK activation, leading to diminished IL-10 production. Inhibition of GSK3 or ablation of the GSK3beta gene ameliorated TLR2-induced peritonitis and arthritis. IFN-gamma suppressed the activity of CREB and AP-1, transcription factors that induce IL-10 expression and are regulated in part by MAPKs and GSK3. These results yield insight into mechanisms by which IFN-gamma regulates IL-10 production and TLR2-mediated inflammatory responses and identify inhibition of CREB and AP-1 as part of the macrophage response to IFN-gamma. GSK3 and CREB/AP-1 are key players in integrating IFN-gamma and TLR2 responses in innate immunity and inflammation.