The tumor microenvironment of human non-small cell lung cancer (NSCLC) is composed largely of stromal cells, including fibroblasts, yet these cells have been the focus of few studies. In this study, we established stromal cell cultures from primary NSCLC through isolation of adherent cells. Characterization of these cells by flow cytometry demonstrated a population which expressed a human fibroblast-specific 112-kDa surface molecule, Thy1, α-smooth muscle actin, and fibroblast activation protein, but failed to express CD45 and CD11b, a phenotype consistent with that of an activated myofibroblast. A subset of the tumor-associated fibroblasts (TAF) was found to express B7H1 (PD-L1) and B7DC (PD-L2) constitutively, and this expression was up-regulated by IFN-γ. Production of cytokines and chemokines, including IFN-γ, monokine induced by IFN-γ, IFN-γ-inducible protein-10, RANTES, and TGF-β1 was also demonstrated in these cells. Together, these characteristics provide multiple opportunities for the TAF to influence cellular interactions within the tumor microenvironment. To evaluate the ability of TAF to modulate tumor-associated T cell (TAT) activation, we conducted coculture experiments between autologous TAF and TAT. In five of eight tumors, TAF elicited a contact-dependent enhancement of TAT activation, even in the presence of a TGF-β1-mediated suppressive effect. In the three other tumors, TAF had a net suppressive effect upon TAT activation, and, in one of these cases, blockade of B7H1 or B7DC was able to completely abrogate the TAF-mediated suppression. We conclude that TAF in human NSCLC are functionally and phenotypically heterogeneous and provide multiple complex regulatory signals that have the potential to enhance or suppress TAT function in the tumor microenvironment.