The effects of a water-soluble amphotericin B (AmB)–arabinogalactan (AG) conjugate on several immune functions were investigated. The experiments measured the effects of AmB–AG on (1) release of tumor necrosis factor-α (TNF-α), nitric oxide (NO), and interferon-γ (IFN-γ) from phagocytic cells and (2) cell-mediated immune responses. AmB–AG increased TNF-α release from mouse peritoneal macrophages and human monocytes but had no effect on IFN-γ and NO release. A commercial preparation of nonconjugated AmB (Fungizone) also increased TNF-α production, but to a lesser extent than AmB–AG. AG alone had no effect on TNF-α production, proving that AmB caused the increased TNF-α production. AmB–AG and Fungizone were also tested for their effect on B- and T-cell proliferation. Neither compound altered T-lymphocyte responses to concanavalin A, but both inhibited the stimulation of B lymphocytes by lipopolysaccharides. However, Fungizone showed a stronger inhibitory effect on B cells. Allocytotoxicity was also inhibited by AmB–AG and more strongly by Fungizone. The increased production of TNF-α by cells treated with AmB–AG and the lower inhibitory effect of AmB–AG on lymphocyte stimulation and allocytotoxicity, as compared with Fungizone, explain the better therapeutic efficacy of the AmB–polysaccharide conjugate. AmB is active because of its preferential binding to ergosterol rather than cholesterol, the former sterol preferentially present in parasite surface membranes. This is also valid for the axenic amastigotes, which were sensitive to the AmB–AG. Overall, our results suggest that the antileishmanial activity of AmB–AG is mediated both directly and via modulation of immune functions.