Mutations in the NOD2 gene are strong genetic risk factors for ileal Crohn's disease. However, the mechanism by which these mutations predispose to intestinal inflammation remains a subject of controversy. We report that Nod2-deficient mice inoculated with Helicobacter hepaticus, an opportunistic pathogenic bacterium, developed granulomatous inflammation of the ileum, characterized by an increased expression of Th1-related genes and inflammatory cytokines. The Peyer's patches and mesenteric lymph nodes were markedly enlarged with expansion of IFN-gamma-producing CD4 and CD8 T cells. Rip2-deficient mice exhibited a similar phenotype, suggesting that Nod2 function likely depends on the Rip2 kinase in this model. Transferring wild-type bone marrow cells into irradiated Nod2-deficient mice did not rescue the phenotype. However, restoring crypt antimicrobial function of Nod2-deficient mice by transgenic expression of alpha-defensin in Paneth cells rescued the Th1 inflammatory phenotype. Therefore, through the regulation of intestinal microbes, Nod2 function in nonhematopoietic cells of the small intestinal crypts is critical for protecting mice from a Th1-driven granulomatous inflammation in the ileum. The model may provide insight into Nod2 function relevant to inflammation of ileal Crohn's disease.