TNF-alpha is a mediator of insulin resistance in sepsis, obesity, and type 2 diabetes and is known to impair insulin signaling in adipocytes. Akt (protein kinase B) is a crucial signaling mediator for insulin. In the present study we examined the posttranslational mechanisms by which short-term (<6-h) exposure of 3T3-L1 adipocytes to TNF-alpha decreases Akt levels. TNF-alpha treatment both increased the ubiquitination of Akt and decreased its protein level. The decrease in protein was associated with the presence of an (immunoreactive) Akt fragment after TNF-alpha treatment, indicative of Akt cleavage. The broad-spectrum caspase inhibitor t-butoxycarbonyl-Asp(O-Me)-fluoromethyl ketone markedly suppressed these effects of TNF-alpha. The caspase-6 inhibitor Z-Val-Glu(OMe)-Ile-Asp(OMe)-CH(2)F potently suppressed Akt ubiquitination, degradation, and fragment formation, whereas the proteasome inhibitor Z-Leu-Leu-Leu-CHO modestly attenuated the decline in Akt levels. Exposure to TNF-alpha also enhanced the association of Akt with an E3 ligase activity. Adipocytes preexposed to TNF-alpha for 5 h and then stimulated with insulin for 30 min exhibited decreased levels of Akt, phosphorylated Akt, as well as phosphorylated Mdm2, which is a known direct substrate of Akt, and glucose uptake. Caspase inhibition attenuated these inhibitory effects of TNF-alpha. Collectively, our results suggest that TNF-alpha induces the caspase-dependent degradation of Akt via the cleavage and ubiquitination of Akt, which results in its degradation through the 26S proteasome. Furthermore, the caspase- and proteasome-mediated degradation of Akt due to TNF-alpha exposure leads to impaired Akt-dependent insulin signaling in adipocytes. These findings expand the mechanism by which TNF-alpha impairs insulin signaling.