AbstractTumor necrosis factor‐alpha (TNF‐α) is a skeletal catabolic agent that stimulates osteoclastogenesis and inhibits osteoblast function. Although TNF‐α inhibits the mineralization of osteoblasts, the effect of TNF‐α on mesenchymal stem cells (MSC) is not clear. In this study, we determined the effect of TNF‐α on osteogenic differentiation of stromal cells derived from human adipose tissue (hADSC) and the role of NF‐κB activation on TNF‐α activity. TNF‐α treatment dose‐dependently increased osteogenic differentiation over the first 3 days of treatment. TNF‐α activated ERK and increased NF‐κB promoter activity. PDTC, an NF‐κB inhibitor, blocked the osteogenic differentiation induced by TNF‐α and TLR‐ligands, but U102, an ERK inhibitor, did not. Overexpression of miR‐146a induced the inhibition of IRAK1 expression and inhibited basal and TNF‐α‐ and TLR ligand‐induced osteogenic differentiation. TNF‐α and TLR ligands increased the expression of transcriptional coactivator with PDZ‐binding motif (TAZ), which was inhibited by the addition of PDTC. A ChIP assay showed that p65 was bound to the TAZ promoter. TNF‐α also increased osteogenic differentiation of human gastroepiploic artery smooth muscle cells. Our data indicate that TNF‐α enhances osteogenic differentiation of hADSC via the activation of NF‐κB and a subsequent increase of TAZ expression. J. Cell. Physiol. 223: 168–177, 2010. © 2009 Wiley‐Liss, Inc.