Activation of endothelial nitric-oxide synthase (eNOS) has been shown to occur through various pathways involving increases in the cytosolic Ca(2+) concentration, activation of the phosphatidylinositol-3' kinase/Akt pathway, as well as regulation by other kinases and by protein-protein interactions. We have recently reported that eNOS, expressed in an inducible HeLa Tet-off cell line, is activated by tumor necrosis factor-alpha (TNF-alpha) in a previously undescribed pathway that involves the lipid messenger ceramide. We have now characterized this pathway. We report here that eNOS activation in response to TNF-alpha correlated with phosphorylation of Akt at Ser 473 and of eNOS itself at Ser 1179. Akt and eNOS phosphorylation, as well as eNOS activation, were blocked by inhibitors of both phosphatidylinositol-3' kinase and neutral sphingomyelinase. In contrast, although acid sphingomyelinase was also stimulated by TNF-alpha, its inhibition was without effect. The activation of neutral sphingomyelinase triggered by TNF-alpha was insensitive to phosphatidylinositol-3' kinase inhibitors. Taken together, these results indicate that eNOS activation by TNF-alpha occurs through sequential activation of neutral sphingomyelinase and of the phosphatidylinositol-3' kinase/Akt pathway. The time course of eNOS activation induced through this pathway was markedly different from that triggered by ATP and epidermal growth factor, which activate eNOS through an increase in intracellular Ca(2+) concentration and through a sphingomyelinase-independent stimulation of the phosphatidylinositol-3' kinase/Akt pathway, respectively. The novel pathway of activation of eNOS described here may have broad biological relevance because neutral sphingomyelinase is activated not only by TNF-alpha but also by a variety of other physiological and pathological stimuli.