Early inflammatory events may inhibit functional recovery after injury in both the peripheral and central nervous systems. We investigated the role of the inflammatory tumor necrosis factor/nuclear factor-kappaB (NF-kappaB) axis on events subsequent to sciatic nerve crush injury in adult rats. Electrophoretic mobility shift assays revealed that within 6 hours after crush, NF-kappaB DNA-binding activity increased significantly in a 1-cm section around the crush site. By immunofluorescence staining, there was increased nuclear localization of the NF-kappaB subunits p50 but not p65 or c-Rel in Schwann cells but no obvious inflammatory cell infiltration. In rats injected subcutaneously with etanercept, a tumor necrosis factor receptor chimera that binds free cytokine, the injury-induced rise in NF-kappaB DNA-binding activity was inhibited, and nuclear localization of p50 in Schwann cells was lowered after the injury. Axonal growth 3 days after nerve crush assessed with immunofluorescence for GAP43 demonstrated that the regeneration distance of leading axons from the site of nerve crush was greater in etanercept-treated animals than in saline-treated controls. These data indicate that tumor necrosis factor mediates rapid activation of injury-induced NF-kappaB DNA binding in Schwann cells and that these events are associated with inhibition of postinjury axonal sprouting.