The pro-inflammatory cytokine tumor necrosis factor-alpha (TNF-alpha) plays a central role in inflammatory disorders. Transmembrane TNF-alpha and its two receptors are cleaved by the proteinase TNF-alpha converting enzyme (TACE), resulting in appreciable serum levels of soluble TNF-alpha and soluble TNF-alpha receptors (sTNFR1 and -2). The only known functions of sTNFR1 are to antagonize and buffer circulating TNF-alpha. Here, we present evidence that sTNFR1 exerts immunoregulatory functions by induction of apoptosis in monocytes through reverse signaling via transmembrane TNF-alpha. sTNFR1-induced apoptosis is independent of death receptor pathways but depends on autocrine transforming growth factor (TGF)-beta1 signaling through the mitogen-activated protein kinase p38alpha. This novel mechanism has implications for understanding the physiological role of sTNFR1 and for TNF-alpha-blocking therapies of autoimmune diseases.