Topical immunotherapy, using sensitizing agents like diphencyprone (DPCP) or squaric acid dibutyl ester (SADBE) to induce controlled contact dermatitis on the scalp, has been used for alopecia areata since the 1980s. The treatment works through immune diversion: the controlled inflammation against the topical agent appears to interfere with the autoimmune attack on hair follicles. Response rates of 30–50% have been reported in case series for extensive alopecia areata.

The treatment protocol involves initial sensitisation, followed by weekly application of dilute solutions sufficient to maintain mild contact dermatitis. Side effects include scalp itching, redness, occasional vesicle formation, and rarely more severe allergic reactions. Treatment continues for many months, patients often need 6+ months to see meaningful regrowth, and continued maintenance is required for many. The treatment is administered only in dermatology clinics due to the need for careful titration and monitoring.

In the era of JAK inhibitors, topical immunotherapy has become a less-used option but retains specific advantages: it produces local immunological effect without systemic immunosuppression, it's substantially less expensive than JAK inhibitors, and it works in some patients who don't respond to systemic therapies. For patients without access to JAK inhibitors due to cost or insurance, or those who prefer to avoid systemic immunosuppression, topical immunotherapy remains a credible option through specialist dermatology services.