The pleiotropic pro-inflammatory cytokine tumour necrosis factor alpha (TNF) is synthesised as a transmembrane protein that is subject to palmitoylation. In this study, the roles of this acylation on TNF-mediated biological effects were investigated. We found that the lipid raft partitioning of TNF is regulated by its palmitoylation. Furthermore, we demonstrated that this palmitoylation process interferes with the cleavage/degradation of TNF intracellular fragments but is not involved in the regulation of its ectodomain shedding. Moreover, we found that the palmitoylation of TNF hinders the binding of soluble TNF to TNFR1 and regulates the integration/retention of TNFR1 into lipid rafts. Finally, we demonstrate that the transmembrane forms of wild-type and palmitoylation-defective TNF interact differently with TNFR1 and regulate NF kappa B activity, Erk1/2 phosphorylation and interleukin-6 synthesis differently, strongly suggesting that palmitoylation of TNF is involved in the regulation of TNFR1 signalling. An evidence for the physiological intervention of this regulation is provided by the fact that in macrophages, the binding of endogenous soluble TNF to TNFR1 is enhanced by inhibition of palmitoylation. Therefore, our data introduce the new concept that palmitoylation of TNF is one of the means by which TNF-producing cells regulate their sensitivity to soluble TNF. (C) 2012 Elsevier B.V. All rights reserved.