SUMMARY: TNF signals are mediated through two different receptors, TNFR1 and TNFR2. In endothelial cells, TNFR1 is predominantly localized in the Golgi apparatus and TNFR2 on the plasma membrane. To investigate structural features responsible for the disparate localization, endothelial cells were transfected with epitope-tagged or green fluorescent protein-fused wild type and mutant receptor molecules. Wild type receptors recapitulated the distribution of endogenous receptors. Deletions of the entire TNFR1 intracellular domain or of the C-terminal death domain (TNFR1^-DD) allowed expression of the receptor on the plasma membrane. However, addition of the death domain to the C-terminus of TNFR2 (TNFR2^+DD) did not lead to Golgi-retention of this chimeric receptor. Overexpressed TNFR1, TNFR2, and TNFR2 ^+DD increased basal expression of a cotransfected NF-KB-dependent promotor-reporter gene. Overexpressed TNFR1^-DD did not activate NF-KB but acted as a ligand-specific dominant negative inhibitor of TNF actions. Unexpectedly, TNF responses were also inhibited by overexpressed TNFR1 and TNFR2^+DD, but not TNFR2. We conclude that the death domain of TNFR1 is required for retention of TNFR1 in the Golgi apparatus but is not sufficient to direct Golgi retention of a TNFR2^+DD chimera, and that overexpressed receptors that contain the death domain (TNFR1 and TNFR2^+DD) spontaneously activate NF-KB while inhibiting TNF responses.