TRAFs constitute a family of proteins that have been implicated in signal transduction by immunomodulatory cellular receptors and viral proteins. TRAF2 and TRAF6 have an E3-ubiquitin ligase activity, which is dependent on the integrity of their RING finger domain and it has been associated with their ability to activate the NF-κB and AP1 signaling pathways. A yeast two-hybrid screen with TRAF2 as bait, identified the regulatory subunit PP4R1 of protein phosphatase PP4 as a TRAF2-interacting protein. The interaction of TRAF2 with PP4R1 depended on the integrity of the RING finger domain of TRAF2. PP4R1 could interact also with the TRAF2-related factor TRAF6 in a RING domain-dependent manner. Exogenous expression of PP4R1 inhibited NF-κB activation by TRAF2, TRAF6, TNF and the Epstein-Barr virus oncoprotein LMP1. In addition, expression of PP4R1 downregulated IL8 induction by LMP1, whereas downregulation of PP4R1 by RNA interference enhanced the induction of IL8 by LMP1 and TNF. PP4R1 could mediate the dephosphorylation of TRAF2 Ser11, which has been previously implicated in TRAF2-mediated activation of NF-κB. Finally, PP4R1 could inhibit TRAF6 polyubiquitination, suggesting an interference with the E3 ubiquitin ligase activity of TRAF6. Taken together, our data identify a novel mechanism of NF-κB pathway inhibition which is mediated by PP4R1-dependent targeting of specific TRAF molecules.