Inclusion Criteria:

   - Patient must have a histologically verified diagnosis of craniopharyngioma

      - Stratum 1: patients with progressive unresectable or recurrent craniopharyngiomas
      treated with surgery alone, who have not received radiation therapy; patients
      with unresectable craniopharyngiomas, (i.e. residual measurable disease following
      surgical resection) will be enrolled at the time of progression

      - Stratum 2: patients with progressive or recurrent craniopharyngiomas following
      radiation therapy

   - All patients must have measurable residual disease defined as tumor measurable in two
   perpendicular diameters on magnetic resonance imaging (MRI)

      - Please note: measurements are required for both the solid and cystic components

   - Subjects must have recovered from the acute toxicities of all prior therapy before
   entering this study; for those acute baseline adverse events attributable to prior
   therapy, recovery is defined as a toxicity grade =< 2, using Common Terminology
   Criterial for Adverse Events (CTCAE) version (v.) 4.0, unless otherwise specified in
   the inclusion and exclusion criteria

   - Myelosuppressive chemotherapy (includes intra-cystic bleomycin):

      - Subjects must have received their last dose of known myelosuppressive anticancer
      chemotherapy at least three (3) weeks prior to study registration or at least six
      (6) weeks if nitrosourea

   - Subjects must have received their last dose of investigational or biologic agent >= 7
   days prior to study registration

      - In the event that a subject has received an investigational or biologic agent and
      has experienced >= grade 2 myelosuppression, then at least three (3) weeks must
      have elapsed prior to registration

      - If the investigational or biologic agent has a prolonged half-life (>= 7 days)
      then at least three (3) weeks must have elapsed prior to registration

   - Subjects must have completed at least 3 half-life periods from the last dose of
   monoclonal antibody prior to registration

      - Note: a list of half-lives of commonly used monoclonal antibodies is available on
      the Pediatric Brain Tumor Consortium (PBTC) website under Generic Forms and
      Templates

   - Stratum 1: patients must not have received radiation therapy

   - Stratum 2: patients must have received radiation therapy, including gamma knife or
   phosphorus-32 (P32)

      - More than 6 months from the time of enrollment if the recurrence is predominantly
      solid

      - More than 12 months from the time of enrollment if the recurrence is
      predominantly cystic

   - At least 7 days since the completion of therapy with a hematopoietic growth agent
   (filgrastim, sargramostim, and erythropoietin) and 14 days for long-acting
   formulations

   - Karnofsky performance scale (KPS for > 16 years [yrs] of age) or Lansky performance
   score (LPS for =< 16 years of age) >= 60 assessed within two weeks prior to
   registration

   - Age: 18 months - 25 years (Minimum weight 20 Kilogram is required to be eligible for
   the study, since the minimum injection volume of SYLATRON is 0.05 ml, 20 mcg, SQ as
   suggested by Merck)

   - Absolute neutrophil count (ANC) >= 1000/ul (unsupported)

   - Platelets >= 100,000/ul (unsupported)

   - Hemoglobin (Hg) >= 8g/dL (unsupported)

   - Alanine aminotransferase (ALT) =< 2.5 x the upper limit of institutional normal

   - Total bilirubin =< x 1.5 upper limit of institutional normal

   - Serum creatinine =< 1.5 x the upper limit of normal for age, or calculated creatinine
   clearance or nuclear glomerular filtration rate (GFR) >= 70 ml/min/1.73 m^2

      - =< 0.6 mg/dL (1 to < 2 years of age)

      - =< 0.8 mg/dL (2 to < 6 years of age)

      - =< 1.0 mg/dL (6 to < 10 years of age)

      - =< 1.2 mg/dL (10 to < 13 years of age)

      - =< 1.4 mg/dL (females >= 13 years of age)

      - =< 1.5 mg/dL (males 13 to < 16 years of age)

      - =< 1.7 mg/dL (males >= 16 years of age)

   - All patients must have undergone at least one surgical procedure to verify the
   diagnosis

   - Patients must have evidence of radiographic progression as defined below:

      - Stratum 1: defined as >= 25% increase in the product of the greatest
      perpendicular diameters of the tumor as a whole (solid and cystic component) AND
      >= 0.4 cm increase in each of at least two dimensions of the tumor as a whole OR
      any new or worsening neurologic/vision deficit in conjunction with a lesser
      change in the solid or cystic component

      - Stratum 2:

         - For patients more than 6 months following radiation therapy (RT) (including
         radiosurgery or P32), progression is defined as a >= 25% increase in the
         product of the greatest perpendicular diameters of the solid component AND
         >= 0.4 cm increase in each of at least two dimensions of the solid component

         - For patients more than 12 months following RT (including radiosurgery or
         P32), progression is defined as >= 25% increase in each of the product of
         the greatest perpendicular diameters of the solid tumor AND >= 0.4 cm
         increase in each of at least two dimensions of the solid tumor; patients
         demonstrating isolated cyst progression more than 12 months after RT must
         show a continued increase in the cystic component on two serial MRI scans
         performed at least 4 weeks apart OR re-accumulation of the cyst following
         one or more cyst aspirations; patients with progressive neurologic signs
         and/or symptoms associated with isolated cyst formation or progression are
         eligible if the neurologic signs and/or symptoms do not improve within 4
         weeks of cyst aspiration

   - Female subjects of childbearing potential must not be pregnant or breast-feeding;
   female subjects of childbearing potential must have a negative serum or urine
   pregnancy test; (pregnancy test must be repeated within 72 hours prior to the start of
   therapy)

   - Subjects of childbearing or child fathering potential must be willing to use a
   medically acceptable form of birth control, which includes abstinence, while being
   treated on this study

   - Ability to understand and the willingness to sign a written informed consent document

Exclusion Criteria:

   - Stratum 1 patients: must not have had > 3 surgical debulking procedures/resections

   - Patients may not have received prior interferon, either systemic or intra-cystic

   - Patients must not have evidence of metastatic tumor

   - Patients must not be on steroids other than for physiologic replacement

   - Patients must not have a severe psychiatric illness, including major depression or any
   previous suicide attempts

   - Patients must not be on phenytoin, warfarin or methadone due to potential drug
   interactions

   - Patients must not have known hypersensitivity reactions, such as urticaria,
   angioedema, bronchoconstriction, anaphylaxis, Steven-Johnson syndrome, and toxic
   epidermal necrolysis to interferon alpha or any other products component

   - Subjects with inability to return for follow-up visits or obtain follow-up studies
   required to assess toxicity to therapy