To increase the efficiency of association of tumor necrosis factor (TNF), a hydrophilic model protein, with liposomes, an N-myristoylation signal sequence was linked to the N-terminus of TNF by gene fusion. A DNA sequence coding for the N-myristoylation signal of Rasheed leukemia virus-gag protein was fused to the 5′-end of the cDNA coding for the mature domain of TNF to give N-myristoylated fusion TNF cDNA.In vitrotranslation of the mRNA coding for this fusion cDNA using rabbit reticulocyte lysate gave rise to an N-myristoylated fusion TNF with a molecular mass of 18 kDa as determined by the incorporation of [3H]myristic acid and by immunoprecipitation with anti-TNF antibody. Replacement of Gly2in the myristoylation signal with Ala entirely inhibited the incorporation of [3H]myristic acid into the fusion protein. A liposome binding assay using Ficoll density gradient centrifugation revealed that incubating the N-myristoylated fusion TNF with dipalmitoyl phosphatidylcholine-liposomes caused the complete binding of the protein to the liposomes, whereas much less of the nonmyristoylated counterpart bound. Thus, N-myristoylated fusion TNF, with high affinity for liposomes, was synthesized by thein vitrotranscription/translation system.