The response of mammalian cells to stress is controlled by transcriptional regulatory proteins such as nuclear factor kappa B (NF-kappa B) to induce a wide variety of early response genes. In this report, we show that exposure of cells to hypoxia (0.02% O2) results in I kappa B alpha degradation, increased NF-kappa B DNA binding activity, and transactivation of a reporter gene construct containing two NF-kappa B DNA binding sites. Pretreatment of cells with protein tyrosine kinase inhibitors and the dominant negative allele of c-Raf-1 (Raf 301) inhibited I kappa B alpha degradation, NF-kappa B binding, and transactivation of kappa B reporter constructs by hypoxia. To demonstrate a direct link between changes in the phosphorylation pattern of I kappa B alpha with NF-kappa B activation, we immunoprecipitated I kappa B alpha after varying times of hypoxic exposure and found that its tyrosine phosphorylation status increased during hypoxic exposure. Inhibition of the transfer of tyrosine phosphoryl groups onto I kappa B alpha prevented I kappa B alpha degradation and NF-kappa B binding. In comparison to other activators of NF-kappa B such as phorbol myristate acetate or tumor necrosis factor, we did not detect changes in the tyrosine phosphorylation status of I kappa B alpha following treatment with either of these agents. These results suggest that tyrosine phosphorylation of I kappa B alpha during hypoxia is an important proximal step which precedes its dissociation and degradation from NF-kappa B.