There is a limited understanding how of lung cancer cells evade cytotoxic attack. Previously, we have shown reduced production of the cytotoxic mediator granzyme B by CD8+ T cells in lung cancer tissue. We hypothesized that lung cancer would be further associated with decreased production of granzyme B, perforin and proinflammatory cytokines by other cytotoxic lymphocytes, natural killer (NK) T-like and NK cells, and that this would result from soluble mediators released by the cancer cells. Lung cancer and non-cancer tissue from five patients was identified by experienced pathologists. Tumour necrosis factor (TNF)-α, interferon (IFN)-γ, granzyme B and perforin were measured in CD4 and CD8+ T, NK T-like cells and NK cells by flow cytometry. Correlation between cancer stage and granzyme B was analysed retrospectively for 21 patients. The effects of soluble factors released by lung cancer cells on production of cytotoxic mediators and cytokines was assessed, and the role of prostaglandin E2 (PGE)2/COX investigated using indomethacin inhibition. There were significantly decreased percentages of T, NK T-like and NK cells expressing perforin, TNF-α and IFN-γ in cancer versus non-cancer tissue, and of CD8+ T cells and CD8+ NK T-like cells expressing granzyme B (e.g. NK T-like cells: non-cancer 30% ± 7 versus cancer 6% ± 2·5). Cancer cells released soluble factors that inhibited granzyme B, perforin and IFN-γ production that was partially associated with the PGE2/COX2 pathway. Thus, lung cancer is associated with decreased expression of granzyme B, perforin and IFN-γ by infiltrating T cells, NK T-like and NK cells, possibly as a result of soluble factors produced by the cancer cells including PGE2. This may be an important immune evasion mechanism.