Ceramide has been proposed as a second messenger molecule implicated in a variety of biological processes, including apoptosis. Recently, it has been reported that tumor necrosis factor-alpha (TNF-alpha) activates the release of ceramide and that ceramide acts as a mediator for the TNF-alpha-induced stimulation of the binding affinity of nuclear factor-KB (NF-KB), a ubiquitous transcription factor of particular importance in immune and inflammatory responses. In this study we demonstrate that dexamethasone, which reduces the production of ceramide, significantly inhibits TNF-alpha-induced activation of NF-KB, c-Jun N-terminal kinase, also known as stress-activating protein kinase, caspase-3-like cysteine protease, redistribution of cytochrome c, and apoptosis in MC3T3E1 osteoblasts. Compared with TNF-alpha-induced JNK activation, ceramide elicits a more rapid activation of JNK within 30 min. C2-ceramide activates NF-KB and caspase-3 like protease to the same degree and with kinetics similar to those of TNF-alpha. This study provides evidence that the release of ceramide may be required as a second messenger in TNF-alpha-induced apoptosis. These results also suggest a regulatory role for dexamethasone in TNF-alpha-induced apoptosis via inhibition of ceramide release. Therefore, our in vitro results suggest that therapies targeted at the inhibition of ceramide release may abrogate inflammatory processes in TNF-alpha-related diseases, including rheumatoid arthritis and periodontitis.