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Polyethylene glycol (PEG) modification improves the pharmacological properties of proteins, usually extending plasma half-life and concomitantly increasing in vivo bioactivity, reducing both antigenicity and immunogenicity, and increasing solubility and resistance to proteolysis. Despite these established benefits, few PEG proteins are in use. Current coupling methods are either traumatic for the protein or involve lengthy and difficult procedures to activate monomethoxyPEG (MPEG). We have applied a new coupling method that allows coupling of MPEG directly to proteins under physiological conditions. Using this method with recombinant human (rh)granulocyte-macrophage colony-stimulating factor (GM-CSF) we were able to construct biologically active PEG-GM-CSF. Fast protein liquid chromatography (FPLC) and phase-partitioning confirmed the presence of PEG modification, and the former was used to fractionate modified and unmodified material. Bioactivity was measured in colony assays of normal human bone marrow cells and by tritiated thymidine uptake (of chronic myeloid leukemia cells and TF-1 cells). With both uptake and colony assays, using unfractionated material, we observed only a modest reduction in biological activity. Assays of FPLC-fractionated material confirmed that much of the bioactivity of the PEG-GM-CSF preparations was due to the modified species and any residual unmodified GM-CSF. Species uncontaminated by tresylmonomethoxyPEG (TMPEG; which was somewhat inhibitory in the thymidine uptake assay and eluted over a broad region of the FPLC profile) had no significant reduction in activity, but we cannot rule out the possibility that PEG-GM-CSF species eluting elsewhere in the profile had modest reduction of activity. Subcutaneous injection into mice confirmed the anticipated improved half-life in vivo and demonstrated a longer uptake from the injection site. This is, as far as we are aware, the first successful construction of PEG-GM-CSF with conserved biological activity.