The transcription factor X-box binding protein 1 (XBP-1) is essential for the differentiation of plasma cells and the unfolded protein response (UPR). Here we show that UPR-induced splicing of XBP-1 by the transmembrane endonuclease IRE1 is required to restore production of immunoglobulin in XBP-1-/- mouse B cells, providing an integral link between XBP-1, the UPR and plasma cell differentiation. Signals involved in plasma cell differentiation, specifically interleukin-4, control the transcription of XBP-1, whereas its post-transcriptional processing is dependent on synthesis of immunoglobulins during B cell differentiation. We also show that XBP-1 is involved in controlling the production of interleukin-6, a cytokine that is essential for plasma cell survival. Thus, signals upstream and downstream of XBP-1 integrate plasma cell differentiation with the UPR.