Tumor necrosis factor-alpha (TNF) receptor-associated factor 2 (TRAF2) is one of the major mediators of TNF receptor superfamily transducing TNF signaling to various functional targets, including activation of NF-kappa B, JNK, and antiapoptosis. We investigated how TRAF2 mediates differentially the distinct downstream signals. We now report a novel mechanism of TRAF2-mediated signal transduction revealed by an association of TRAF2 with sphingosine kinase (SphK), a lipid kinase that is responsible for the production of sphingosine 1-phosphate. We identified a TRAF2-binding motif of SphK that mediated the interaction between TRAF2 and SphK resulting in the activation of the enzyme, which in turn is required for TRAF2-mediated activation of NF-kappa B but not JNK. In addition, by using a kinase inactive dominant-negative SphK and a mutant SphK that lacks TRAF2-binding motif we show that the interaction of TRAF2 with SphK and subsequent activation of SphK are critical for prevention of apoptosis during TNF stimulation. These findings show a role for SphK in the signal transduction by TRAF2 specifically leading to activation of NF-kappa B and antiapoptosis.