Many inhibitor of apoptosis (IAP) family proteins inhibit apoptosis. IAPs contain N-terminal baculovirus IAP repeat domains and a C-terminal RING ubiquitin ligase domain. Drosophila IAP DIAP1 is essential for the survival of many cells, protecting them from apoptosis by inhibiting active caspases. Apoptosis initiates when proteins such as Reaper, Hid, and Grim bind a surface groove in DIAP1 baculovirus IAP repeat domains via an N-terminal IAP-binding motif. This evolutionarily conserved interaction disrupts DIAP1-caspase interactions, unleashing apoptosis-inducing caspase activity. A second Drosophila IAP, DIAP2, also binds Rpr and Hid and inhibits apoptosis in multiple contexts when overexpressed. However, due to a lack of mutants, little is known about the normal functions of DIAP2. We report the generation of diap2 null mutants. These flies are viable and show no defects in developmental or stress-induced apoptosis. Instead, DIAP2 is required for the innate immune response to Gram-negative bacterial infection. DIAP2 promotes cytoplasmic cleavage and nuclear translocation of the NF-kappaB homolog Relish, and this requires the DIAP2 RING domain. Increasing the genetic dose of diap2 results in an increased immune response, whereas expression of Rpr or Hid results in down-regulation of DIAP2 protein levels. Together these observations suggest that DIAP2 can regulate immune signaling in a dose-dependent manner, and this can be regulated by IBM-containing proteins. Therefore, diap2 may identify a point of convergence between apoptosis and immune signaling pathways.