RATIONALE: Interferon alfa may interfere with the growth of cancer cells and slow the growth of the tumor. Thalidomide may stop the growth of cancer by stopping blood flow to the tumor. Combining interferon alfa with thalidomide may kill more tumor cells.

PURPOSE: Phase II trial to study the effectiveness of combining interferon alfa with thalidomide in treating patients who have stage IV melanoma.

OBJECTIVES:

• Determine the 6-month progression-free survival rate in patients with stage IV melanoma treated with interferon alfa and thalidomide.
• Determine the confirmed and unconfirmed complete and partial response rates in patients with measurable disease treated with this regimen.
• Determine the quantitative and qualitative toxic effects of this regimen in these patients.

OUTLINE: This is a multicenter study.

Patients receive interferon alfa subcutaneously twice daily and oral thalidomide once daily on days 1-28. Courses repeat every 4 weeks in the absence of disease progression or unacceptable toxicity. Patients achieving complete response (CR) receive 2 additional courses after documentation of CR.

Patients are followed every 3 months for 2 years and then every 6 months for 1 year.

PROJECTED ACCRUAL: A total of 35 patients will be accrued for this study.

DISEASE CHARACTERISTICS:

• Histologically confirmed stage IV malignant melanoma

  • Surgically incurable disease

• Measurable or evaluable disease

• No brain metastases by CT scan or MRI

  • Prior brain metastases allowed only if completely resected and treated with whole brain radiotherapy

• Must have received 1, and only 1, prior systemic therapy for metastatic disease

  • Chemotherapy, biologic/immunotherapy, hormonal therapy, or combination therapy

PATIENT CHARACTERISTICS:

Age:

• Adult

Performance status:

• Zubrod 0-2

Life expectancy:

• Not specified

Hematopoietic:

• Absolute neutrophil count at least 1,000/mm^3
• Platelet count at least 75,000/mm^3

Hepatic:

• SGOT and/or SGPT no greater than 2.5 times upper limit of normal (ULN)
• Bilirubin no greater than ULN

Renal:

• Creatinine no greater than 1.5 times ULN

Other:

• Not pregnant or nursing
• Negative pregnancy test
• Fertile patients must use 2 methods of effective contraception 4 weeks before, during, and for 4 weeks after study
• HIV negative
• No AIDS or HIV-1-associated complex
• No other serious illness
• No serious active infections
• No sensory neuropathy greater than grade 1
• No prior seizures or concurrent potential risk factors for the development of seizures
• No other prior malignancy within the past 5 years except adequately treated basal cell or squamous cell skin cancer, carcinoma in situ of the cervix, or adequately treated stage I or II cancer currently in complete remission

PRIOR CONCURRENT THERAPY:

Biologic therapy:

• See Disease Characteristics
• At least 21 days since prior biologic therapy or immunotherapy in the adjuvant or metastatic setting and recovered
• No concurrent filgrastim (G-CSF)
• No other concurrent biologic therapy

Chemotherapy:

• See Disease Characteristics
• At least 21 days since prior chemotherapy in the adjuvant or metastatic setting and recovered
• No concurrent chemotherapy

Endocrine therapy:

• See Disease Characteristics
• At least 21 days since prior hormonal therapy in the adjuvant or metastatic setting and recovered
• No concurrent hormonal therapy
• No concurrent systemic steroids (including creams)

Radiotherapy:

• See Disease Characteristics
• At least 21 days since prior radiotherapy and recovered
• Prior radiotherapy to all known sites of disease allowed if there is objective evidence of progression
• No concurrent radiotherapy

Surgery:

• See Disease Characteristics
• At least 21 days since prior surgery for primary or metastatic disease and recovered
• No concurrent surgery

Other:

• At least 21 days since prior systemic therapy or combination regimen for metastatic disease and recovered
• At least 21 days since prior adjuvant isolation limb perfusion therapy and recovered
• No other concurrent therapy
• No other concurrent investigational drugs
• No concurrent immunosuppressive medications
• Concurrent antihistamines allowed if no alternative medication available