The mechanism was investigated underlying the activity of bacterial lipopolysaccharide (LPS) as an adjuvant of antibody formation as assessed by its capacity to modulate the induction of tolerance in mice to the antigen human Ig G (HGG) into a state of immunity to HGG. The adjuvant activity of LPS was found to be closely correlated with its ability to function as a B-cell mitogen. This correlation was revealed by an analysis of the genetic control of the mitogenic and adjuvant properties of LPS utilizing the refractory state inherent in the C3H/HeJ mouse strain to these activities of LPS. Thus, mice that were the progeny of a backcross between the nonresponder C3H/JeJ parent and the responder (C3H/HeJ X CWB) F1 hybrid were individually typed for responsiveness to LPS, as an adjuvant and as a B-cell mitogen. It was found that LPS interfered with tolerance induction to HGG in vivo only in those backcross progeny whose spleen cells were also capable of responding mitogenically to LPS in vitro, demonstrating that the adjuvant and B-cell mitogenic properties of LPS are genetically linked. In contrast, these properties were observed to segregate independently from either H-2 or heavy chain allotype loci, and were not sex linked. These results are compatible with the concepts that, in this system, (a) the cellular site of action of LPS as an adjuvant is confined to B cells, and (b) the subcellular mode of action of LPS as an adjuvant may involve the delivery of a "signal" to B cells which is a stimulus for mitogenesis.