Death receptor-induced programmed cell death (PCD) is crucial for the maintenance of immune homeostasis. However, interference of downstream death receptor signaling by genetic ablation or transgenic (Tg) expression of different apoptosis inhibitors often impairs lymphocyte activation. The viral FLICE (caspase-8)-like inhibitor proteins (v-FLIPs) are potent inhibitors of death receptor-induced apoptosis and programmed necrosis. We generated Tg mice expressing the v-FLIP MC159 from Molluscum contagiosum virus under the control of the H2Kb class I MHC promoter to examine the role of death receptor-induced PCD in the control of immune functions and homeostasis. We found that expression of MC159 led to lymphoproliferation and autoimmunity as exemplified by T and B lymphocyte expansion, accumulation of TCRalphabeta+ CD3+ B220+ CD4- CD8- lymphocytes in secondary lymphoid organs, elevated serum Ig levels, and increased anti-dsDNA Ab titers. These phenotypes were caused by defective death receptor-induced apoptosis, but not by defective passive cell death in the absence of mitogenic stimulation. Lymphocyte activation was normal, as demonstrated by normal thymidine incorporation and CSFE dilution of T cells stimulated with anti-CD3 and anti-CD28 Abs. In addition, effector CD8+ T cell responses to acute and memory lymphocytic choriomeningitis virus infections were unaffected in the Tg mice. These phenotypes are reminiscent of the lpr and gld mice, and show that the v-FLIP MC159 is a bona fide PCD inhibitor that does not interfere with other essential lymphocyte functions. Thus, the MC159-Tg mice provide a model to study the effects of PCD in immune responses without hampering other important lymphocyte functions.