The zebrafish (Danio rerio) is a powerful model organism for studies of the innate immune system. One apparent difference between human and zebrafish innate immunity is the cellular machinery for LPS-sensing. In amniotes, the protein complex formed by Toll-like receptor 4 and myeloid differentiation factor 2 (Tlr4/Md-2) recognizes the bacterial molecule lipopolysaccharide (LPS) and triggers an inflammatory response. It is believed that zebrafish have neither Md-2 nor Tlr4: Md-2 has not been identified outside of amniotes, while the zebrafish?tlr4?genes appear to be paralogs, not orthologs, of amniote?TLR4s. We revisited these conclusions. We identified a zebrafish gene encoding Md-2,?ly96. Using single-cell RNA-Seq, we found that?ly96?is transcribed in cells that also transcribe genes diagnostic for innate immune cells, including the zebrafish?tlr4-like genes. Unlike amniote?LY96, zebrafish?ly96?expression is restricted to a small number of macrophage-like cells. In a functional assay, zebrafish Md-2 and Tlr4a form a complex that activates NF-κB signaling in response to LPS, but?ly96?loss-of-function mutations gave little protection against LPS-toxicity in larval zebrafish. Finally, by analyzing the genomic context of?tlr4?genes in eleven jawed vertebrates, we found that?tlr4?arose prior to the divergence of teleosts and tetrapods. Thus, an LPS-sensitive Tlr4/Md-2 complex is likely an ancestral feature shared by mammals and zebrafish, rather than a?de novoinvention on the tetrapod lineage. We hypothesize that zebrafish retain an ancestral, low-sensitivity Tlr4/Md-2 complex that confers LPS-responsiveness to a specific subset of innate immune cells.