Isoindolin-1-one and Isoindoline-1,3-dione substituted in the 2-position with an .alpha.-(3,4-disubstituted phenyl)alkyl group and in the 4- and/or 5-position with a nitrogen-containing group are inhibitors of, and thus useful in the treatment of disease states mediated by, TNF.alpha. and phosphodiesterase. A typical embodiment is 2-[1-(3-ethoxy-4-methoxyphenyl)2-methylsulfonylethyl]4,5-diaminoisoindoli- ne-1,3-dione.