Signal regulatory protein α (SIRPα) is a membrane glycoprotein immunoreceptor abundant in cells of monocyte lineage. SIRPα ligation by a broadly expressed transmembrane protein, CD47, results in phosphorylation of the cytoplasmic immunoreceptor tyrosine-based inhibitory motifs, resulting in the inhibition of NF-κB signaling in macrophages. Here we observed that proteolysis of SIRPα during inflammation is regulated by a disintegrin and metalloproteinase domain-containing protein 10 (ADAM10), resulting in the generation of a membrane-associated cleavage fragment in both THP-1 monocytes and human lung epithelia. We mapped a charge-dependent putative cleavage site near the membrane-proximal domain necessary for ADAM10-mediated cleavage. In addition, a secondary proteolytic cleavage within the membrane-associated SIRPα fragment by γ-secretase was identified. Ectopic expression of a SIRPα mutant plasmid encoding a proteolytically resistant form in HeLa cells inhibited activation of the NF-κB pathway and suppressed STAT1 phosphorylation in response to TNFα to a greater extent than expression of wild-type SIRPα. Conversely, overexpression of plasmids encoding the proteolytically cleaved SIRPα fragments in cells resulted in enhanced STAT-1 and NF-κB pathway activation. Thus, the data suggest that combinatorial actions of ADAM10 and γ-secretase on SIRPα cleavage promote inflammatory signaling.