The TMPRSS2/ERG (T/E) fusion gene is present and thought to be an oncogenic driver of approximately half of all prostate cancers. Fusion of the androgen-regulated TMPRSS2 promoter to the ERG oncogene results in constitutive high level expression of ERG which promotes prostate cancer invasion and proliferation. Here, we report the characterization of multiple alternatively spliced T/E fusion gene isoforms which have differential effects on invasion and proliferation. We found that T/E fusion gene isoforms differentially increase NF-κB-mediated transcription, which may explain in part the differences in biological activities of the T/E fusion isoforms. This increased activity is due to phosphorylation of NF-κB p65 on Ser536. Tissue microarray immunochemistry revealed that p65 phospho-Ser536 is present in the majority of prostate cancers where it is associated with ERG protein expression. The T/E fusion gene isoforms differentially increase expression of a number of NF-κB associated genes including PAR1, CCL2, FOS, TLR3, and TLR4 (Toll-like receptor). TLR4 activation is known to promote p65 Ser536 phosphorylation and knockdown of TLR4 with shRNA decreases Ser536 phosphorylation in T/E fusion gene expressing cells. TLR4 can be activated by proteins in the tumor microenvironment and lipopolysacharide from Gram (-) bacteria. Our findings suggest that bacterial infection of the prostate and/or endogenous microenvironment proteins may promote progression of high-grade prostatic intraepithelial neoplasia and/or prostate cancers that express the T/E fusion gene, where the NF-κB pathway might be targeted as a rational therapeutic approach.