In a signal sequence trap screening of the murine brain, we identified a new member of the tumor necrosis factor receptor superfamily designated TROY. TROY is a type I membrane protein of 416 amino acids with characteristic cysteine-rich motifs in the extracellular domain and a tumor necrosis factor receptor-associated factor (TRAF) 2 binding sequence in the cytoplasmic domain of 223 amino acids. In fact, activation of nuclear factor kappaB was induced by the overexpression of TROY and inhibited by dominant negative forms of TRAF2, TRAF5, and TRAF6, indicating that TRAFs and nuclear factor kappaB are involved in the signal transduction of TROY. We also cloned a cDNA for a human counterpart, which showed a 75% homology with mouse TROY at the amino acid level. The extracellular domain of TROY exhibits an extensive homology with that of Edar, a receptor that specifies hair follicle fate. TROY mRNA is strongly expressed in brain and embryo and moderately expressed in the heart, lung, and liver but not the spleen. In the embryo, the expression level is particularly strong in the skin. Interestingly, in situ hybridization analysis of the embryo showed that TROY mRNA was exclusively expressed in the epithelium of many tissues. On the other hand, in neonatal mice, TROY is expressed in hair follicles like Edar as well as in the cerebrum, suggesting pleiotropic functions of TROY in development as well as in the adult mice. The Troy gene is located near the waved coat (Wc) locus, a mutant related to abnormalities in skin and hair.