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A specific LC-MS method was developed for separation, identification and characterization of the process-related substances and degradation products in tofacitinib citrate. The separation was achieved on a LiChrospher C18 column (250 mm × 4.6 mm, 5 μm) by linear gradient elution of 0.1% ammonium acetate solution (pH adjusted to 4.0 by formic acid) and acetonitrile at a flow rate of 1.0 mL/min. Forced degradation studies were conducted under hydrolytic (acidic, basic), oxidative, photolytic and thermal stress conditions as described in ICH. It was found that tofacitinib was stable under photolytic condition, but degraded obviously in acidic, basic, thermal and oxidative conditions. The high resolution TOF-MS and MS/MS were used for determination and structural identification of the related substances. Eleven major related substances were detected and identified as five process-related substances and six degradation products, and three of them were further synthesized and characterized by NMR spectroscopy. The most plausible mechanisms involved in the formation of the related substances were also proposed. Since related substances have a significant impact on drug safety, quality and efficacy, the data obtained are valuable for process monitoring and quality assurance of tofacitinib citrate.Eleven impurities of tofacitinib were identified by LC-MS technology.Two process-related substances and one degradation product were synthesized and confirmed by NMR.Synthesis optimization was proposed and the process-related impurities were minimized or eliminated from the bulk drug.The degradation pathway was studied and appropriate storage condition was suggested.