Tumor necrosis factor (TNF) functions both as a soluble molecule and as a cell surface 26 kDa transmembrane protein, from which the soluble form is proteolytically derived. The 26 kDa TNF molecules isolated from 32P labeled HeLa cells that had been transfected with the cDNA of a partially cleavable TNF mutant were found labeled. Phosphorylated 26 kDa TNF molecules could also be isolated from human LPS stimulated monocytic Mono Mac 6. Phosphoaminoacid analysis revealed that the labeled phosphate is bound to serine residues. No label was found incorporated in soluble 17 kDa TNF, indicating that the phosphorylated residue(s) of membrane-associated TNF occur in the cytoplasmic portion of the molecule. Phosphorylation of the intracellular domain of the 26 kDa TNF molecules may play a role in the regulation of expression or proteolytic processing of TNF, modulate TNF bioactivity, or take part in intracellular signaling by cell-surface TNF.