Interleukin (IL)-17, the founding member of the IL-17 cytokine family, is the hallmark of a novel subset of CD4+ T cells that is regulated by TGFbeta, IL-6, and IL-23. IL-17 plays an important role in promoting tissue inflammation in host defense against infection and in autoimmune diseases. Although IL-17 has been reported to regulate the expression of proinflammatory cytokines, chemokines, and matrix metalloproteinases, the signaling mechanism of IL-17 receptor has not been understood. An earlier study found that IL-17 activates NF-kappaB and MAPK pathways and requires TRAF6 to induce IL-6. However, it is unknown what molecule(s) directly associates with IL-17 receptor to initiate the signaling. We demonstrate here that IL-17 receptor family shares sequence homology in their intracellular region with Toll-IL-1 receptor (TIR) domains and with Act1, a novel adaptor previously reported as an NF-kappaB activator. MyD88 and IRAK4, downstream signaling components of TIR, are not required for IL-17 signaling. On the other hand, Act1 and IL-17 receptor directly associate likely via homotypic interaction. Deficiency of Act1 in fibroblast abrogates IL-17-induced cytokine and chemokine expression, as well as the induction of C/EBPbeta, C/EBPdelta, and IkappaBzeta. Also, absence of Act1 results in a selective defect in IL-17-induced activation of NF-kappaB pathway. These results thus indicate Act1 as a membrane-proximal adaptor of IL-17 receptor with an essential role in induction of inflammatory genes. Our study not only for the first time reveals an immediate signaling mechanism downstream of an IL-17 family receptor but also has implications in therapeutic treatment of various immune diseases.