Bcl-2 and Bcl-x(L) are reported to inhibit CD95-mediated apoptosis in "type II" but not in "type I" cells. In the present studies, we found that stimulation of CD95 receptors, with either agonistic antibody or CD95 ligand, resulted in the activation of caspase-8, which in turn processed caspase-3 between its large and small subunits. However, in contrast to control cells, those overexpressing either Bcl-2 or Bcl-x(L) displayed a distinctive pattern of caspase-3 processing. Indeed, the resulting p20/p12 caspase-3 was not active and did not undergo normal autocatalytic processing to form p17/p12 caspase-3, because it was bound to and inhibited by endogenous X-linked inhibitor-of-apoptosis protein (XIAP). Importantly, Bcl-2 and Bcl-x(L) inhibited the release of both cytochrome c and Smac from mitochondria. However, since Smac alone was sufficient to promote caspase-3 activity in vitro by inactivating XIAP, we proposed the existence of a death receptor-induced, Smac-dependent and apoptosome-independent pathway. This type II pathway was subsequently reconstituted in vitro using purified recombinant proteins at endogenous concentrations. Thus, mitochondria and associated Bcl-2 and Bcl-x(L) proteins may play a functional role in death receptor-induced apoptosis by modulating the release of Smac. Our data strongly suggest that the relative ratios of XIAP (and other inhibitor-of-apoptosis proteins) to active caspase-3 and Smac may dictate, in part, whether a cell exhibits a type I or type II phenotype.