NF-kappaB is a key activator of inflammatory and immune responses with important pathological roles in cancer, heart disease, and autoimmune diseases. Transcriptional activity of NF-kappaB is regulated by different posttranslational modifications. Here, we report a novel mechanism of NF-kappaB regulation through lysine monomethylation by SET9 methyltransferase. Set9 specifically methylates p65 at lysine 37. Both TNFalpha and IL-1beta treatments induced methylation of p65. Methylated p65 is restricted to the nucleus and this modification regulates the promoter binding of p65. Moreover, Set9 mediated methylation of p65 is required for the expression of a subset of NF-kappaB target genes in response to TNFalpha stimulation.