CD40 ligand, a type II transmembrane protein recently renamed CD154, was originally considered restricted to activated T lymphocytes, functioning as a mediator of T cell-dependent B cell activation, proliferation, and differentiation. However, the spectrum of CD154 expression and function has broadened considerably during recent years, establishing new roles as a central mediator of immunity and inflammation for this member of the tumor necrosis factor (TNF) gene superfamily. The emerging picture indicates that ligation of the receptor CD40 via CD154, most potently in its trimeric form, functions in two ways. CD154 modulates physiologic processes, such as T cell-mediated effector functions and general immune responses required for appropriate host defense, but also triggers the expression of pro-inflammatory mediators, such as cytokines, adhesion molecules, and matrix degrading activities, all of which are associated with the pathogenesis of chronic inflammatory diseases, e.g., autoimmune disorders, arthritis, atherosclerosis, and cancer. Accordingly, CD40/CD154 interactions have advanced as a potential therapeutic target for these diseases, whereby two opposing strategies, interruption as well as enhancement of CD40 signaling, are explored for beneficial outcomes.