Activation of endothelial cells, important in processes such as angiogenesis, is regulated by cell surface receptors, including those in the tyrosine kinase (RTK) family. Receptor activity, in turn, can be modulated by phosphorylation, turnover, or proteolytic release of a soluble extracellular domain. Previously, we demonstrated that release of soluble tie-1 receptor from endothelial cells by phorbol myristate acetate (PMA) is mediated through protein kinase C and a Ca²⁺-dependent protease. In this study, the release of soluble tie-1 was shown to be stimulated by inflammatory cytokines and vascular endothelial growth factor (VEGF), but not by growth factors such as basic fibroblast growth factor (bFGF) or transforming growth factor  (TGF). Release of soluble tie by tumor necrosis factor  (TNF) or VEGF occurred within 10 minutes of stimulation and reached maximal levels within 60 minutes. Specificity was shown by fluorescence-activated cell sorting (FACS) analysis; endothelial cells exhibited a significant decrease in cell surface tie-1 expression in response to TNF, whereas expression of epidermal growth factor receptor (EGF-R) and CD31 was stable. In contrast, tie-1 expression on megakaryoblastic UT-7 cells was unaffected by PMA or TNF. Sequence analysis of the cleaved receptor indicated that tie-1 was proteolyzed at the E⁷⁴⁹/S⁷⁵⁰ peptide bond in the proximal transmembrane domain. Moreover, the hydroxamic acid derivative BB-24 demonstrated dose-dependent inhibition of cytokine-, PMA-, and VEGF-stimulated shedding, suggesting that the tie-1 protease was a metalloprotease. Protease activity in a tie-1 peptide cleavage assay was (1) associated with endothelial cell membranes, (2) specifically activated in TNF-treated cells, and (3) inhibited by BB-24. Additionally, proliferation of endothelial cells in response to VEGF, but not bFGF, was inhibited by BB-24, suggesting that the release of soluble tie-1 receptor plays a role in VEGF-mediated proliferation. This study demonstrated that the release of soluble tie-1 from endothelial cells is stimulated by inflammatory cytokines and VEGF through the activation of an endothelial membrane-associated metalloprotease.