The Kaposi's sarcoma-associated herpesvirus (KSHV, also called human herpesvirus 8) has been linked to KS and primary effusion lymphoma (PEL) in immunocompromised individuals. We report that PEL cell lines have constitutive active alternative NF-kappa B pathway and demonstrate high-level expression of NF-kappa B2/p100 precursor and its processed subunit p52. To elucidate the mechanism of activation of the alternative NF-kappa B pathway in PEL cells, we have investigated the role of KSHV-encoded viral Fas-associated death domain-like IL- beta 1-converting enzyme inhibitory protein (vFLIP) K13. We demonstrate that stable expression of K13, but not other FLIPs, in a variety of cell lines constitutively up-regulates p100/NF-kappa B2 expression and leads to its processing into the p52 subunit. K13-induced up-regulation and processing of p100 critically depends on the I kappa B kinase (IKK)alpha/IKK1 subunit of the IKK complex, whereas IKK beta/IKK2, receptor-interacting protein, and NF-kappa B-inducing kinase are dispensable for this process. Silencing of endogenous K13 expression by siRNA inhibits p100 processing and cellular proliferation. Our results demonstrate for the first time, to our knowledge, that KSHV vFLIP K13 is required for the growth and proliferation of PEL cells and alternative NF-kappa B pathway plays a key role in this process. Therapeutic agents targeting the alternative NF-kappa B pathway may have a role in the treatment of KSHV-associated lymphomas.