Cachexia is associated with poor prognosis in patients with chronic disease. Tumor necrosis factor-alpha (TNFα) plays a pivotal role in mediating cachexia and has been demonstrated to inhibit skeletal muscle differentiation in vitro. It has been proposed that TNFα-mediated activation of NFκB leads to down regulation of MyoD, however the mechanisms underlying TNFα effects on skeletal muscle remain poorly understood. We report here a novel pathway by which TNFα inhibits muscle differentiation through activation of caspases in the absence of apoptosis. TNFα-mediated caspase activation and block of differentiation are dependent upon the expression of PW1, but occur independently of NFκB activation. PW1 has been implicated previously in p53-mediated cell death and can induce bax translocation to the mitochondria. We show that bax-deficient myoblasts do not activate caspases and differentiate in the presence of TNFα, highlighting a role for bax-dependent caspase activation in mediating TNFα effects. Taken together, our data reveal that TNFα inhibits myogenesis by recruiting components of apoptotic pathways through PW1.