Tumor necrosis factor alpha (TNF) is known to be one of the primary causative cytokines inflicting the characteristic damage to hepatocytes seen in alcoholic liver disease. TNF activates both cell survival and death-inducing signaling pathways. The balance between these two prongs determines the fate of the cell and the onset of disease. Ethanol exposure has been shown to alter mitochondrial function, decreasing their threshold for injury. Importantly, mitochondrial injury is a necessary end point of TNF-induced cell killing. It has been shown that ethanol exposure increases the sensitivity of hepatocytes and HepG2E47 cells to TNF-mediated death. The cumulative and terminal effect of the increased sensitivity to TNF caused by ethanol is an induction of a mitochondrial permeability transition. TNF brings about the mitochondrial permeability transition in ethanol-exposed cells due to amplification in the activity of the p38 stress kinase and a diminution in the activity of the antiapoptotic Akt/PKB kinase. The present report identifies an increase of PTEN expression in ethanol-exposed cells as the main causative factor in altering the balance between prosurvival and prodeath signals initiated by TNF. Suppression of the elevated PTEN levels found in ethanol-exposed HepG2E47 cells through the use of RNA interference reversed the ethanol-induced alterations to TNF signaling, resulting in a preservation of mitochondrial function and cell viability.