The protease ADAM17 (a disintegrin and metalloproteinase 17) catalyzes the shedding of various transmembrane proteins from the surface of cells, including tumor necrosis factor (TNF) and its receptors. Liberation of TNF receptors (TNFRs) from cell surfaces can dampen the cellular response to TNF, a cytokine that is critical in the innate immune response and promotes programmed cell death but can also promote sepsis. Catalytically inactive members of the rhomboid family of proteases, iRhom1 and iRhom2, mediate the intracellular transport and maturation of ADAM17. Using a genetic screen, we found that the presence of either iRhom1 or iRhom2 lacking part of their extended amino-terminal cytoplasmic domain (herein referred to as ΔN) increases ADAM17 activity, TNFR shedding, and resistance to TNF-induced cell death in fibrosarcoma cells. Inhibitors of ADAM17, but not of other ADAM family members, prevented the effects of iRhom-ΔN expression. iRhom1 and iRhom2 were functionally redundant, suggesting a conserved role for the iRhom amino termini. Cells from patients with a dominantly inherited cancer susceptibility syndrome called tylosis with esophageal cancer (TOC) have amino-terminal mutations in iRhom2. Keratinocytes from TOC patients exhibited increased TNFR1 shedding compared with cells from healthy donors. Our results explain how loss of the amino terminus in iRhom1 and iRhom2 impairs TNF signaling, despite enhancing ADAM17 activity, and may explain how mutations in the amino-terminal region contribute to the cancer predisposition syndrome TOC.