X-linked inhibitor of apoptosis (XIAP) is an endogenous inhibitor of cell death that functions by suppressing caspases 3, 7, and 9. Here we describe the establishment of Jurkat-derived cell lines stably overexpressing either full-length XIAP or a truncation mutant of XIAP that can only inhibit caspase 9. Characterization of these cell lines revealed that following CD95 activation full-length XIAP supported both short- and long-term survival as well as proliferative capacity, in contrast to the truncation mutant but similar to Bcl-x(L). Full-length XIAP was also able to inhibit CD95-mediated caspase 3 processing and activation, the mitochondrial release of cytochrome c and Smac/DIABLO, and the loss of mitochondrial membrane potential, whereas the XIAP truncation mutant failed to prevent any of these cell death events. Finally, suppression of XIAP levels by RNA interference sensitized Bcl-x(L)-overexpressing cells to death receptor-induced apoptosis. These data demonstrate for the first time that full-length XIAP inhibits caspase activation required for mitochondrial amplification of death receptor signals and that, by acting upstream of mitochondrial activation, XIAP supports the long-term proliferative capacity of cells following CD95 stimulation.