Idiopathic pneumonia syndrome (IPS) is a diffuse, noninfectious lung injury that occurs acutely after allogeneic hematopoietic cell transplantation (HCT). IPS-related mortality has been historically high (>50%) despite treatment with systemic corticosteroids and supportive care measures. We have now examined the role of tumor necrosis factor inhibition in a randomized, double-blind, placebo-controlled trial of corticosteroids with etanercept or placebo. Thirty-four subjects (≥18 years) with IPS after HCT were randomized to receive methylprednisolone (2 mg/kg/day) plus etanercept (0.4 mg/kg twice weekly × 4 weeks; n = 16) or placebo (n = 18). No active infections and a pathogen-negative bronchoscopy were required at study entry. Response (alive, with complete discontinuation of supplemental oxygen support) and overall survival were examined. This study, originally planned to accrue 120 patients, was terminated prematurely due to slow accrual. In the limited number of patients examined, there were no differences in response rates at day 28 of study. Ten of 16 patients (62.5% [95% confidence interval {CI}, 35.4% to 84.8%]) receiving etanercept and 12 of 18 patients (66.7% [95% CI, 41.0% to 86.7%]) receiving placebo met the day 28 response definition (P = 1.00). The median survival was 170 days (95% CI, 11 to 362) with etanercept versus 64 days (95% CI, 26 to 209) with placebo (P = .51). Among responders, the median time to discontinuation of supplemental oxygen was 9 days (etanercept) versus 7 days (placebo). Therapy was well tolerated, with 1 toxicity-related death from infectious pneumonia in the placebo arm. The treatment of IPS with corticosteroids in adult HCT recipients was associated with high early response rates (>60%) compared with historical reports, with poor overall survival. The addition of etanercept did not lead to further increases in response, although the sample size of this truncated trial preclude a definitive conclusion.