The Rel/NF-kappaB and NFAT families of transcription factors are related through an N-terminal DNA-binding domain called the Rel Homology domain (RHD). Neither the RHD nor the NF-kappaB pathway has been identified in a basal (i.e., nonbilaterian) animal phylum. Using genomic and cDNA databases, we have identified two RHD domain-containing proteins from the cnidarian Nematostella vectensis: an NF-kappaB-like protein (Nv-NF-kappaB) and an NFAT-like protein (Nv-NFAT). The gene structure and RHD predicted amino acid sequence of Nv-nfkb are similar to those of the vertebrate NF-kappaB p50/p52 proteins, whereas the sequence of Nv-NFAT allows only ambiguous assignment to the NFAT family. Nv-NF-kappaB lacks the C-terminal IkappaB-like sequences present in all other NF-kappaB proteins. There are, however, two IkappaB-like genes in Nematostella encoded by loci distinct from Nv-nfkb. The separate nfkb and ikb genes of Nematostella may reflect the ancestral metazoan condition, suggesting that a gene fusion event created the nfkb genes in Drosophila and vertebrates. Nematostella also has genes that encode upstream and downstream components of the vertebrate NF-kappaB signaling pathway. Upstream components include Toll- and tumor necrosis-like receptors and ligands, adaptor proteins (Trafs, Myd88), caspases, and a TBK-like kinase. Downstream components include the NF-kappaB coactivator protein Bcl-3 and several NF-kappaB target genes. These results demonstrate that RHD-containing transcription factors and associated pathways are evolutionarily more ancient than previously known. Moreover, they suggest models for the evolutionary diversification of the insect and vertebrate Rel/NF-kappaB/IkappaB and NFAT gene families and suggest that cnidarians possess an NF-kappaB-regulated developmental or stress response pathway.