TALL-1 is a member of the TNF family that is critically involved in B cell survival, maturation, and progression of lupus-like autoimmune diseases. TALL-1 has three receptors, including BCMA, TACI, and BAFF-R, which are mostly expressed by B lymphocytes. Gene knockout studies have indicated that BAFF-R is the major stimulatory receptor for TALL-1 signaling and is required for normal B cell development. The intracellular signaling mechanisms of BAFF-R are not known. In this report, we attempted to identify BAFF-R-associated downstream proteins by yeast two-hybrid screening. This effort identified TNFR-associated factor (TRAF)3 as a protein specifically interacting with BAFF-R in yeast two-hybrid assays. Coimmunoprecipitation experiments indicated that BAFF-R interacts with TRAF3 in B lymphoma cells and this interaction is stimulated by TALL-1 treatment. Domain mapping experiments indicated that both a 6-aa membrane proximal region and the C-terminal 35 aa of BAFF-R are required for its interaction with TRAF3. Moreover, overexpression of TRAF3 inhibits BAFF-R-mediated NF-kappaB activation and IL-10 production. Taken together, our findings suggest that TRAF3 is a negative regulator of BAFF-R-mediated NF-kappaB activation and IL-10 production.