Globoid cell leukodystrophy (Krabbe disease) is characterized by the accumulation of a toxic metabolite, psychosine (galactosylsphingosine), which is a substrate for the deficient enzyme (galactocerebroside beta-galactosidase). This study underscores the possible role of psychosine in the effect of inducible nitric oxide synthase (iNOS) -derived NO in the pathophysiology of this demyelinating disease. For the first time, we provide evidence of the expression of iNOS in CNS of Krabbe patient and show that the iNOS-expressing cells in the CNS were astrocytes. Psychosine potentiated the LPS-induced production of proinflammatory cytokines (IL-1beta, IL-6, and TNF-alpha) in primary rat astrocytes and regulated the cytokine-mediated production of NO in C6 glioma and primary rat astrocyte. Psychosine induced cytokine-mediated nuclear translocation of AP-1 and C/EBP by potentiating the expression of Fra-1 and C/EBP-delta proteins. This suggests that psychosine maintained or sustained the cytokine-primed expression of iNOS by further potentiating the nuclear translocation of AP-1 and C/EBP without modulating the cytokine-mediated transcription activity of NF-kappaB. This study hypothesizes that accumulated psychosine leads to production of cytokines and iNOS expression. The ensuing excessive production of NO and ONOO- may play a role in pathogenesis of Krabbe disease.