Notch1 specifically upregulates expression of the cytokine interferon-gamma in peripheral T cells through activation of NF-kappaB. However, how Notch mediates NF-kappaB activation remains unclear. Here, we examined the temporal relationship between Notch signaling and NF-kappaB induction during T-cell activation. NF-kappaB activation occurs within minutes of T-cell receptor (TCR) engagement and this activation is sustained for at least 48 h following TCR signaling. We used gamma-secretase inhibitor (GSI) to prevent the cleavage and subsequent activation of Notch family members. We demonstrate that GSI blocked the later, sustained NF-kappaB activation, but did not affect the initial activation of NF-kappaB. Using biochemical approaches, as well as confocal microscopy, we show that the intracellular domain of Notch1 (N1IC) directly interacts with NF-kappaB and competes with IkappaBalpha, leading to retention of NF-kappaB in the nucleus. Additionally, we show that N1IC can directly regulate IFN-gamma expression through complexes formed on the IFN-gamma promoter. Taken together, these data suggest that there are two 'waves' of NF-kappaB activation: an initial, Notch-independent phase, and a later, sustained activation of NF-kappaB, which is Notch dependent.