The activation of nuclear factor of activated T cells 5 (NFAT5), a well-known osmoprotective factor, can be induced by isotonic stimuli, such as activated Toll-like receptors (TLRs). It is unclear, however, how NFAT5 discriminates between isotonic and hypertonic stimuli. In this study we identified a novel context-dependent suppression of NFAT5 target gene expression in RAW 264.7 macrophages stimulated with lipopolysaccharide (LPS) or a high salt (NaCl) concentration. Although LPS and NaCl both used NFAT5 as a core transcription factor, these stimuli mutually inhibited distinct sets of NFAT5 targets within the cells. Although reactive oxygen species (ROS) are essential for this inhibition, the source of ROS differed depending on the context: mitochondria for high salt and xanthine oxidase for TLRs. Specifically, the high salt-induced suppression of interleukin-6 (IL-6) production was mediated through the ROS-induced inhibition of NFAT5 binding to the IL-6 promoter. The context-dependent inhibition of NFAT5 target gene expression was also confirmed in mouse spleen and kidney tissues that were cotreated with LPS and high salt. Taken together, our data suggest that ROS function as molecular sensors to discriminate between TLR ligation and osmotic stimuli in RAW 264.7 macrophages, directing NFAT5 activity toward proinflammatory or hypertonic responses in a context-dependent manner.