Tumor necrosis factor-alpha is a potent cytokine, secreted primarily by activated monocytes and macrophages, that possesses a broad range of immunomodulating properties. Involvement of this cytokine has been validated in disease states such as arthritis and Crohn's disease and implicated in diverse neuroimmunological pathologies such as multiple sclerosis, Alzheimers and stroke. TNF-alpha is initially synthesized as a 26 kDa precursor molecule that is subsequently processed to the mature form by cleavage of the Ala76 Val77 bond. The 17 kDa carboxy-terminal protein is then secreted to function in a paracrine manner. The enzyme that processes precursor TNF-alpha has previously been identified as a microsomal metalloprotease called TNF-alpha converting enzyme (TACE). We have now purified and partially cloned the enzyme. TACE represents a novel target for therapeutic intervention in a variety of inflammatory and neuroimmunological diseases.