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Airway inflammation is implicated in the pathogenesis of the airway hyperresponsiveness in asthma. An increased production of inflammatory cell progenitors may contribute to asthmatic airway inflammation. Although the number of circulating inflammatory cell progenitors in asthmatic subjects increases after allergen inhalation, no direct evidence exists for increased bone marrow progenitor production. We examined the effect of allergen inhalation on bone marrow progenitor production in seven dogs that develop allergen-induced airway hyperresponsiveness. The effect of inhaled budesonide, a corticosteroid known to be effective in the treatment of asthma, on allergen-induced bone marrow progenitor production and airway hyperresponsiveness was also examined. Allergen inhalation increased airway responsiveness (P < 0.001) and the number of granulocyte-macrophage colony-forming units (CFU) when cultured with dog serum and either recombinant canine stem cell factor (rcSCF) (P < 0.001) or granulocyte colony-stimulating factor (rcG-CSF) (P = 0.035). Budesonide treatment reduced the allergen-induced increases in airway responsiveness (P = 0.005) and abolished the allergen-induced increases in the numbers of CFU cultured with dog serum and either rcSCF (P < 0.001) or rcG-CSF (P = 0.009). These findings provide the first direct evidence that allergen inhalation increases bone marrow progenitor production and suggest that such increases may contribute to the development of airway hyperresponsiveness in asthma. In addition, the effectiveness of inhaled corticosteroids in asthma may result, in part, from their ability to suppress bone marrow production of inflammatory cells.