Nuclear factor kappaB (NF-kappaB) plays a pivotal role in inflammation, immunity, stress responses, and protection from apoptosis. Canonical activation of NF-kappaB is dependent on the phosphorylation of the inhibitory subunit IkappaBalpha that is mediated by a multimeric, high molecular weight complex, called IkappaB kinase (IKK) complex. This is composed of two catalytic subunits, IKKalpha and IKKbeta, and a regulatory subunit, NEMO/IKKgamma. The latter protein is essential for the activation of IKKs and NF-kappaB, but its mechanism of action is not well understood. Here we identified ABIN-1 (A20 binding inhibitor of NF-kappaB) as a NEMO/IKKgamma-interacting protein. ABIN-1 has been previously identified as an A20-binding protein and it has been proposed to mediate the NF-kappaB inhibiting effects of A20. We find that both ABIN-1 and A20 inhibit NF-kappaB at the level of the IKK complex and that A20 inhibits activation of NF-kappaB by de-ubiquitination of NEMO/IKKgamma. Importantly, small interfering RNA targeting ABIN-1 abrogates A20-dependent de-ubiquitination of NEMO/IKKgamma and RNA interference of A20 impairs the ability of ABIN-1 to inhibit NF-kappaB activation. Altogether our data indicate that ABIN-1 physically links A20 to NEMO/IKKgamma and facilitates A20-mediated de-ubiquitination of NEMO/IKKgamma, thus resulting in inhibition of NF-kappaB.