Inclusion Criteria

DISEASE CHARACTERISTICS:

- Histologically confirmed adenocarcinoma of the prostate

- Androgen-independent disease

- Testosterone ≤ 50 ng/mL

- Is currently receiving luteinizing hormone-releasing hormone agonists as
maintenance or has undergone prior orchiectomy for testosterone suppression

- Progressive disease, as defined by ≥ 1 of the following:

- Clinical or radiographic evidence of metastases that have progressed
irrespective of PSA changes

- Asymptomatic (non-opioid requiring) bone-only metastatic disease with a rising
PSA on separate measurements ≥ 1 week apart

- No symptomatic bone metastases

- Biochemical progression (PSA-only disease), defined as having an absolute PSA
value of ≥ 2.0 ng/mL on 3 separate measurements ≥ 2 weeks apart with a PSA
doubling time of ≤ 10 months

- No evidence of CNS (brain or leptomeningeal) metastases or pleural and/or pericardial
effusions

PATIENT CHARACTERISTICS:

- ECOG performance status of 0-1

- ANC ≥ 1,500/mm^3

- Platelet count ≥ 100,000/mm^3

- Serum creatinine ≤ 2.0 mg/dL

- AST < 3 times normal

- Bilirubin < 1.5 mg/dL

- PT and PTT normal

- Calcium normal

- Fertile patients must use effective contraception during and for ≥ 28 days after
completion of study therapy

- Agrees to abstain from donating blood, semen, or sperm during and for ≥ 28 days after
completion of study therapy

- No pre-existing peripheral neuropathy > grade 1

- No active unresolved infection

- No known contraindication to lenalidomide or sargramostim

- No other malignancies within the past 5 years, except for curatively treated basal
cell or squamous cell carcinoma of the skin or stage Ta transitional cell carcinoma
of the bladder

PRIOR CONCURRENT THERAPY:

- See Disease Characteristics

- No prior chemotherapy for metastatic prostate cancer

- More than 1 year since prior adjuvant and/or neoadjuvant therapy

- More than 4 weeks since prior flutamide (6 weeks for other antiandrogens)

- No prior thalidomide or lenalidomide

- At least 4 weeks since prior surgery or external-beam radiotherapy and recovered

- At least 6 weeks since prior radiopharmaceutical therapy, including samarium-153 or
strontium-89, and recovered

- No initiation of bisphosphonate therapy within 1 month before and during study
therapy

- Patients on stable doses of bisphosphonates who show subsequent tumor
progression may continue to receive bisphosphonates

- Concurrent daily aspirin for the prevention of thrombotic events required

- Patients intolerant to aspirin may receive low-dose warfarin as prophylaxis

- No other concurrent investigational agents

- No other concurrent anticancer therapy, including radiotherapy or thalidomide