MD-2 is a part of the Toll-like 4 signaling complex with an indispensable role in activation of the lipopolysaccharide (LPS) signaling pathway and thus a suitable target for the therapeutic inhibition of TLR4 signaling. Elucidation of MD-2 structure provides a foundation for rational design of inhibitors that bind to MD-2 and inhibit LPS signaling. Since the hydrophobic binding pocket of MD-2 provides little specificity for inhibitors, we have investigated targeting the solvent-accessible cysteine residue within the hydrophobic binding pocket of MD-2. Compounds with affinity for the hydrophobic pocket that contain a thiol-reactive group, which mediates covalent bond formation with the free cysteine residue of MD-2, were tested. Fluorescent compounds 2-(4'-(iodoacetamido)anilino)naphthalene-6-sulfonic acid and N-pyrene maleimide formed a covalent bond with MD-2 through Cys(133) and inhibited LPS signaling. Cell activation was also inhibited by thiol-reactive compounds JTT-705 originally targeted against cholesterol ester transfer protein and antirheumatic compound auranofin. Oral intake of JTT-705 significantly inhibited endotoxin-triggered tumor necrosis factor alpha production in mice. The thiol group of MD-2 also represents the target of environmental or endogenous thiol-reactive compounds that are produced in inflammation.