The acyl poly(1,3)galactoside (APG) from Klebsiella pneumoniae is a bis-acylated Lipopolysaccharide(LPS) devoid of eater-linked fatty acids, APG interacts with CD14 and CD11b/CD18 on monocytes, This study addressed the role of serum proteins in the binding and functional properties of APG as a candidate LPS antagonist, In the absence of serum, APG did not induce tumor necrosis factor alpha (TNF-alpha) synthesis by human mononuclear cells and dose-dependently inhibited their activation induced by different LPS, Conversely, in the presence of 5% autologous plasma, APG activated cells and did not antagonize LPS, Serum decreased APG but not LPS binding to monocytes, Binding competition experiments indicated that APG and LPS competed for the same receptors in serum-free conditions but bound to different receptors in the presence of plasma, The data indicate that serum-dependent LPS receptors do contribute to LPS activation of monocytes but do hot recognize deacylated LPS analogues.