Bruton's tyrosine kinase (Btk) has recently been shown to participate in the induction of nuclear factor kappaB (NFkappaB)-dependent gene expression by the lipopolysaccharide (LPS) receptor Toll-like receptor-4 (TLR4). In this study we have examined the mechanism whereby Btk participates in this response. Treatment of the murine monocytic cell line Raw264.7 with LFM-A13, a specific Btk inhibitor, blocked LPS-induced NFkappaB-dependent reporter gene expression but not IkappaB alpha degradation. Transient transfection of HEK293 cells with Btk had no effect on NFkappaB-dependent reporter gene expression but strongly promoted transactivation of a reporter gene by a p65-Gal4 fusion protein. IkappaB alpha degradation activated by LPS was intact in macrophages from X-linked immunodeficiency (Xid) mice, which contain inactive Btk. Transfection of cells with a dominant negative form of Btk (BtkK430R) inhibited LPS-driven p65 mediated transactivation. Additionally LFM-A13 impaired phosphorylation of serine 536 on p65 induced by LPS in HEK293-TLR4 cells, and in Xid macrophages this response was impaired. This study therefore reveals a novel function for Btk. It is required for the signaling pathway activated by TLR4, which culminates in phosphorylation of p65 on serine 536 promoting transactivation by NFkappaB.