Glucocorticoids are the most effective and widely used anti-inflammatory treatments but in some diseases they are ineffective. We have shown that many of the anti-inflammatory actions of glucocorticoids may be explained by ligand-activated glucocorticoid receptors switching off activated inflammatory genes that are associated with acetylated core histones through the recruitment of the nuclear enzyme histone deacetylase-2 (HDAC2), which reverses histone acetylation leading to gene suppression. In several inflammatory diseases, such as chronic obstructive pulmonary disease (COPD) and severe asthma, glucocorticoids are far less effective in suppressing inflammation. This appears to be due to a reduction in the expression and activity of HDAC2. Oxidative stress and cigarette smoke induce steroid resistance through reducing HDAC2 activity and expression through the activation of phosphoinositide-3-kinase-delta (PI3Kd), thus leading to phosphorylation and subsequent ubiquitination and proteolytic degradation of HDAC2. Hypoxia also induces steroid resistance through reducing the expression of HDAC2 and this is mediated through the activation of HIF-1α, which directly binds to the promoter region of HDAC2 to inhibit its gene transcription. Oxidative stress is increased in several severe inflammatory diseases and in severe COPD there is also hypoxia, which together lead to profound steroid resistance. The steroid resistance secondary to oxidative stress is reversible with low concentrations of theophylline and nortriptyline, which have long been used in clinical practice. We have shown that both drugs work by selectively inhibiting activated PI3Kd and that their effects are mimicked by knockdown of PI3Kd by interference RNA or by selective PI3Kd inhibitors. The reduction in HDAC2 gene expression as a result of hypoxia may be reversed by macrolide antibiotics, although the molecular mechanism for this effect has not yet been defined. Although our research has focussed on severe airway disease it is likely that similar mechanisms may apply in other inflammatory diseases.