Transmembrane TNF-alpha (tmTNF-alpha) contains a leader sequence (LS) that can be phosphorylated and cleaved at its cytoplasmic portion, inducing IL-12 production. We observed that the breast cancer cell line MDA-MB-231 expressing transmembrane TNF-alpha (tmTNF-alpha) at high level was resistant to soluble TNF-alpha (sTNF-alpha)-induced cytotoxicity, accompanied by constitutive NF-kappaB activation. In contrast, MCF-7 cells expressing tmTNF-alpha at very low level were sensitive to sTNF-alpha-induced cell death and had no detectable NF-kappaB activation. Consistently, siRNA-mediated tmTNF-alpha knockdown blocked NF-kappaB activation and rendered MDA-MB-231 sensitive. To test our hypothesis that TNF-LS may play an important role in determining the sensitivity of tumor cells to sTNF-alpha, we stably transfected MCF-7 cells with TNF-LS. We found that transfection of TNF-LS or wild-type TNF-alpha containing LS constitutively activated NF-kappaB and conferred the cytotoxic resistance of MCF-7 cells, while transfection of a mutant tmTNF-alpha lacking the cytoplasmic segment of LS neither activated NF-kappaB nor affected the sensitivity. However, NF-kappaB inhibitor PDTC suppressed NF-kappaB activation and reconstituted sensitivity of TNF-LS/MCF-7 cells. To check whether TNF-LS is required to be cleaved or internalized for NF-kappaB activation to occur, we used signal peptide peptidase inhibitor (Z-LL)(2)-ketone and receptor internalization inhibitor MDC to treat cells. Interestingly, both inhibitors increased TNF-LS expression on the cell surface and enhanced NF-kappaB activation. These results indicate that membrane-anchored TNF-LS contributes to constitutive activation of NF-kappaB and resistance to sTNF-alpha-induced cell death. Therefore, TNF-LS appears to be responsible for tmTNF-alpha-induced resistance in the breast cancer cells.