The Drosophila nuclear factor-kappaB (NF-kappaB)-like transcription factor Relish is activated by an endoproteolytic cleavage step mediated by the Drosophila caspase Dredd. We have examined the contribution of the caspase cascade to NF-kappaB activation via TRAIL, a mammalian tumor necrosis factor family ligand that is a potent activator of caspases. Our results demonstrate that TRAIL activates NF-kappaB in two phases as follows: an early caspase independent phase and a late caspase dependent phase. The late phase of the TRAIL-induced NF-kappaB is critically dependent on caspase 8 and can be blocked by pharmacological and genetic inhibitors of caspase 8 activation, such as benzyloxycarbonyl-VAD-fluoromethyl ketone, benzyloxycarbonyl-IETD-fluoromethyl ketone, and small interfering RNA targeting caspase 8 and FADD. Whereas caspase 3 is required for TRAIL-induced apoptosis, it is not involved in TRAIL-induced NF-kappaB activation. The late phase of TRAIL-induced NF-kappaB activation involves caspase mediated cleavage of IkappaBalpha between Asp(31) and Ser(32) residues to generate an N-terminal truncated fragment that is degraded by the proteasome via the N-end rule pathway. Our results demonstrate that caspases play an evolutionarily conserved role as regulated entry points to the N-end rule pathway and in NF-kappaB activation in mammalian cells.