Tumor necrosis factor-alpha (TNF-alpha) is synthesized as a 26-kDa transmembrane protein (mTNF-alpha), which may present on the cell surface or be processed to release the 17-kDa soluble form (sTNF-alpha). Because regulation of this ectodomain shedding might be critical in the generation of systemic versus local cytokine responses, we examined the rate of mTNF-alpha processing in adipocytes and its regulation in obesity. Here, we demonstrate that the 26-kDa mTNF-alpha is present in adipose tissue and that its production is significantly increased in different rodent obesity models as well as in obese humans. There was no apparent deficiency in the level of the major TNF-alpha converting enzyme in adipose tissue to account for the excess amount of mTNF-alpha produced in obesity. However, experiments in cultured fat cells stably expressing TNF-alpha demonstrated a significantly decreased rate of TNF-alpha cleavage in differentiated adipocytes compared with preadipocytes. Thus, a decreased processing rate of mTNF-alpha in mature adipocytes combined with an increase in TNF-alpha production may be a potential mechanism resulting in elevated membrane-associated TNF-alpha in adipose tissue in obesity.