Expression of CD137 ligand (4-1BBL), a member of the TNF family of proteins, has been reported on several types of APCs, various carcinoma cells, and can be induced on activated T cells. In this study, we report that the soluble ligand was released constitutively at low levels from leukocytes and at higher levels following cellular activation. Release from cells was blocked by addition of a metalloproteinase inhibitor which concomitantly caused the accumulation of 4-1BBL on the cell surface. In addition, we show that a soluble form of 4-1BBL was present at high levels in the sera of some patients with various hematological diseases, but only at low levels in healthy donors. Soluble 4-1BBL was active in that it competed with recombinant 4-1BBL for binding to the 4-1BB receptor and was able to costimulate IL-2 and IFN-gamma release from peripheral T cells. These results indicate that the release of soluble 4-1BBL from the cell surface is mediated by one or more sheddases and likely regulates 4-1BB-4-1BBL interactions between cells in vivo. Cleavage of 4-1BBL to an active soluble form would alter both proximal and distal cellular responses, including cell survival and costimulatory or inflammatory responses, that are mediated through the 4-1BB pathway. This, in turn, would likely alter disease progression or outcome.