Interferon Alfa and Thalidomide in Treating Patients With Soft Tissue Sarcoma or Bone Sarcoma

DISEASE CHARACTERISTICS: * Histologically confirmed primary or metastatic soft tissue sarcoma or bone sarcoma at high risk of recurrence * Grade III-IV tumor greater than 8 cm * Grade III-IV primary tumor greater than 5 cm with positive surgical margins * Grade III-IV primary tumor greater than 5 cm with distant metastases resected within 1 year of primary surgery * No more than 8 weeks since prior surgical resection of primary or metastatic disease * Ineligible for other high priority national or institutional study PATIENT CHARACTERISTICS: Age: * 18 and over Performance status: * SWOG 0-2 Life expectancy: * More than 2 months Hematopoietic: * WBC greater than 3,000/mm\^3 * Neutrophil count at least 1,500/mm\^3 * Platelet count greater than 70,000/mm\^3 * Hemoglobin at least 10.0 g/dL Hepatic: * Bilirubin less than 2.0 mg/dL * SGOT or SGPT less than 3 times upper limit of normal (ULN)\* * Alkaline phosphatase less than 3 times ULN\* * No decompensated liver disease * No autoimmune hepatitis * No coagulation disorders NOTE: \* Unless due to metastatic disease Renal: * Creatinine normal Cardiovascular: * No history of severely debilitating cardiovascular disease * No unstable angina * No uncontrolled congestive heart failure * No thrombophlebitis Pulmonary: * No history of severely debilitating pulmonary disease * No chronic obstructive pulmonary disease * No pulmonary embolism Other: * Not pregnant or nursing * Negative pregnancy test * Fertile patients must use 2 forms of effective contraception for 4 weeks before, during, and for 4 weeks after study * No acute infection requiring systemic antibiotics * No prior hypersensitivity to interferon alfa or any component of the injection * No diabetes mellitus prone to ketoacidosis * No severe myelosuppression * No history of autoimmune disease * No pre-existing thyroid abnormalities with thyroid function that cannot be maintained in the normal range * No clinically significant retinal abnormalities * No other serious medical or psychiatric illness that would preclude study * No prior malignancy except curatively treated carcinoma in situ of the cervix or skin cancer PRIOR CONCURRENT THERAPY: Biologic therapy: * Not specified Chemotherapy: * Prior systemic chemotherapy allowed Endocrine therapy: * Not specified Radiotherapy: * Prior radiotherapy allowed Surgery: * See Disease Characteristics