We have previously reported that tumor necrosis factor receptor-associated factor 1 (TRAF1), an intracellular protein, which binds to a range of molecules, including tumor necrosis factor (TNF) receptor family members, regulates TNF-induced NF-kappaB and AP-1 signaling as well as TCR-triggered proliferative responses in T cells. In order to define the role of TRAF1 in Th cell differentiation, we analyzed the responses of TRAF1-/- T cells following TCR activation. Stimulation of TRAF1-/- T cells by antigen resulted in significantly increased expression of the Th2 cytokines (IL-4, IL-5 and IL-13) compared with wild-type (WT) controls. The Th2 bias of TRAF1-/- T cells is T lymphocyte intrinsic, since naive CD4+CD62L+ TRAF1-/- T cells activated with CD3/CD28 produced elevated levels of Th2 cytokines. Consistent with these observations in cultured T cells, TRAF1-/- T cells induced enhanced Th2 responses in vivo. Transfer of ovalbumin (OVA)-immune TRAF1-/- T cells into naive WT recipients conferred significantly more intense pulmonary inflammation and higher airway hyperresponsiveness following inhaled OVA challenge than did transfer of OVA-immune WT T cells. Biochemical analysis of TRAF1-/- T cells revealed that they have elevated nuclear expression of NFAT-interacting protein (NIP45), a Th2 cell-associated transcription factor known to potentiate NFATp-driven IL-4 expression. In further experiments, we demonstrated that TRAF1 associates with a fraction of NIP45 in the cytoplasm and prevents its translocation to the nucleus. Taken together these results suggest that TRAF1 may limit the induction of Th2 responses by decreasing NIP45 concentration to the nucleus and thereby down-regulating the expression of NIP45-dependent IL-4 gene transcription.