Nucleotide-binding oligomerization domain-containing protein (NOD)1 and NOD2 are intracellular pattern recognition receptors (PRRs) of the nucleotide-binding domain and leucine-rich repeat containing (NLR) gene family involved in innate immune responses. Their centrally located NACHT domain displays ATPase activity and is necessary for activation and oligomerization leading to inflammatory signaling responses. Mutations affecting key residues of the ATPase domain of NOD2 are linked to severe auto-inflammatory diseases, such as Blau syndrome and early-onset sarcoidosis. By mutational dissection of the ATPase domain function, we show that the NLR-specific extended Walker B box (DGhDE) can functionally replace the canonical Walker B sequence (DDhWD) found in other ATPases. A requirement for an intact Walker A box and the magnesium-co-ordinating aspartate of the classical Walker B box suggest that an initial ATP hydrolysis step is necessary for activation of both NOD1 and NOD2. In contrast, a Blau-syndrome associated mutation located in the extended Walker B box of NOD2 that results in higher autoactivation and ligand-induced signaling does not affect NOD1 function. Moreover, mutation of a conserved histidine in the NACHT domain also has contrasting effects on NOD1 and NOD2 mediated NF-κB activation. We conclude that these two NLRs employ different modes of activation and propose distinct models for activation of NOD1 and NOD2.