Tumor necrosis factor (TNF)-alpha is initially synthesized as a membrane-bound, cell-associated 26-kDa protein that is further cleaved to yield the soluble 17-kDa form. By using a radiolabeled in vitro translated TNF-alpha precursor we detected a serine proteinase processing activity present in crude membrane preparations of monocytic cells able to generate a 17-kDa active protein. A similar processing pattern was obtained using purified neutral serine proteinase proteinase-3 (PR-3). Moreover, while a secretory leukocyte proteinase inhibitor (a natural serine anti-proteinase) did not affect the in vitro TNF-alpha processing, IgG preparations containing high titers of anti-PR-3 autoantibodies completely blocked this activity. The NH2-terminal sequencing of the reaction products obtained with either membrane preparations or PR-3 showed that cleavage occurs in both cases between Val77 and Arg78. These results together with cellular expression and localization of PR-3 suggest a potential role for this enzyme as an accessory TNF-alpha processing enzyme.