The transcription factor NF-kappaB plays important roles in inflammation and cell survival. NF-kappaB is composed of homodimeric and heterodimeric complexes of Rel/NF-kappaB family members, including p65 (RelA), c-Rel (Rel), RelB, NF-kappaB1/p50, and NF-kappaB2/p52. Here we report the identification and characterization of a novel ZU5 and death domain-containing protein designated ZUD. In reporter gene assays, overexpression of ZUD inhibited NF-kappaB-dependent transcription induced by both tumor necrosis factor (TNF) and interleukin-1 and their downstream signaling proteins. Gel shift assays indicated that the overexpression of ZUD inhibited binding of NF-kappaB to its target sequence. ZUD is a cytoplasmic protein, and coimmunoprecipitation assays indicated that ZUD interacted with the NF-kappaB subunit p105 and transactivator p65. Consistent with its role in inhibition of NF-kappaB-dependent transcription, ZUD sensitized cells to apoptosis induced by TNF and the TNF-related apoptosis-inducing ligand (TRAIL). Our findings suggest that ZUD is an inhibitor of NF-kappaB activation and that this protein may provide an alternative regulatory mechanism for NF-kappaB-mediated transcription.