The telomeric class III region of the major histocompatibility complex is gene dense, but apart from the three tumour necrosis factor (TNF) superfamily members (TNF, lymphotoxin alpha and lymphotoxin beta) little is known of the expression and function of the majority of the genes. Recent genetic studies in autoimmune diseases, particularly rheumatoid arthritis (RA), have suggested a human leukocyte antigen (HLA)-DR-independent disease effect in this region. To gain further insights into these associations, we used lipopolysaccharide-stimulated human macrophages to examine inducible mRNA expression and genotype-phenotype relationships for genes in this region. Following stimulation in addition to the expected induction of TNF mRNA, a 14-fold increase of ATP6V1G2 at 18 h (P<0.001) was seen, whereas B-associated transcript (BAT)2 (P<0.001) and leucocyte-specific transcript (LST)1 (P<0.001) were both downregulated. By genotyping single-nucleotide polymorphisms spanning a 70 kb interval centred on the TNF locus, we constructed haplotypes and determined associated expression profiles for 10 genes in the cluster using quantitative real-time polymerase chain reaction. Overexpression of BAT1 mRNA was associated with carriers of a haplotype containing the LST1 marker transmitted to RA cases in a family study and also DRB1(*)15 associated with susceptibility to nephritis in systemic lupus erythematosus. The implications of our findings for the understanding of genetic associations with disease susceptibility in this region are discussed.