Besides inducing apoptosis, tumor necrosis factor-related apoptosis-inducing ligand (TRAIL) activates NF-κB. The apoptosis signaling pathway of TRAIL is well characterized involving TRAIL receptors, Fas-associated protein with death domain (FADD) and caspase-8. In contrast, the molecular mechanism of TRAIL signaling to NF-κB remains controversial. Here, we characterized the receptor–proximal mediators of NF-κB activation by TRAIL. Deletion of the DD of TRAIL receptors 1 and 2 revealed that it is essential in NF-κB signaling. Because FADD interacts with the TRAIL receptor DD, FADD was tested. RNAi-mediated knockdown of FADD or FADD deficiency in JURKAT T-cell leukemia cells decreased or disabled NF-κB signaling by TRAIL. In contrast, TRAIL-induced activation of NF-κB was maintained upon loss of receptor interacting protein 1 (RIP1) or knockdown of FLICE-like inhibitory protein (FLIP). Exogenous expression of FADD rescued TRAIL-induced NF-κB signaling. Loss-of-function mutations of FADD within the RHDLL motif of the death effector domain, which is required for TRAIL-induced apoptosis, abrogated FADD's ability to recruit caspase-8 and mediate NF-κB activation. Accordingly, deficiency of caspase-8 inhibited TRAIL-induced activation of NF-κB, which was rescued by wild-type caspase-8, but not by a catalytically inactive caspase-8 mutant. These data establish the mechanism of TRAIL-induced NF-κB activation involving the TRAIL receptor DD, FADD and caspase-8, but not RIP1 or FLIP. Our results show that signaling of TRAIL-induced apoptosis and NF-κB bifurcates downstream of caspase-8.