The oncogenic fusion protein RET/PTC3 (RP3) that is expressed in papillary thyroid carcinoma (PTC) and thyroid epithelia in Hashimoto's thyroiditis activates nuclear factor-kappa B (NF-κB) and induces pro-inflammatory gene expression; however, the mechanism of this activation is unknown. To address this, we expressed RP3 in murine embryonic fibroblasts (MEFs) lacking key classical and noncanonical NF-κB signaling components. In wild-type MEFs, RP3 upregulated CCL2, CXCL1, granulocyte-macrophage colony-stimulating factor and tumor necrosis factor expression and activated classical but not noncanonical NF-κB. RP3-activated NF-κB in IκB kinase (IKK)β(-/-) MEFs but not IKKα- or NF-κB essential modulator (NEMO)-deficient cells and activation was inhibited by a peptide that blocks NEMO binding to the IKKs. RP3 increased the levels of NF-κB-inducing kinase (NIK) and did not activate NF-κB in NIK-deficient MEFs. Notably, NIK stabilization was not accompanied by TRAF3 degradation demonstrating that RP3 disrupts normal basal NIK regulation. Dominant-negative NIK blocked RP3-induced NF-κB activation and an RP3 signaling mutant (RP3(Y588F)) did not stabilize NIK. Finally, examination of PTC specimens revealed strong positive staining for NIK. We therefore conclude that RP3 activates classical NF-κB via NIK, NEMO and IKKα. Importantly, our findings reveal a novel mechanism for oncogene-induced NF-κB activation via stabilization of NIK.