Anti-parasitic drugs may achieve their therapeutic effect either by direct activity against the pathogenic organism, or by altering host factors which lead to parasite killing. In this review, we discuss the evidence for an indirect mode of action for one major anti-filarial drug, diethylcarbamazine (DEC). The interpretation most consistent with existing data is that DEC alters arachidonic acid metabolism in microfilariae and in host endothelial cells. These changes may result in vasoconstriction and amplified endothelial adhesion leading to immobilization of microfilarial parasites, enhanced adherence and cytotoxic activity by host platelets and granulocytes. These events would represent activation of the innate, non-specific immune system, independent of the adaptive, antigen-specific, immune response. This model explains the paradox between rapid clearance in vivo and the lack of an in vitro effect, as well as the efficacy of DEC in non-immune animals. It may also account for the inconsistencies in the effects of DEC against different filariae in different host species. In addition, we discuss the significant side-effects often associated with treatment of heavily infected patients, and the longer-term changes in T-cell reactivity and the host-parasite relationship which follow successful treatment with DEC.