Caspase 8 initiates apoptosis downstream of TNF death receptors by undergoing autocleavage and processing the executioner caspase 3 (ref. 1). However, the dominant function of caspase 8 is to transmit a pro-survival signal that suppresses programmed necrosis (or necroptosis) mediated by RIPK1 and RIPK3 (refs 2-6) during embryogenesis and haematopoiesis(7-9). Suppression of necrotic cell death by caspase 8 requires its catalytic activity but not the autocleavage essential for apoptosis(10); however, the key substrate processed by caspase 8 to block necrosis has been elusive. A key substrate must meet three criteria: it must be essential for programmed necrosis; it must be cleaved by caspase 8 in situations where caspase 8 is blocking necrosis; and mutation of the caspase 8 processing site on the substrate should convert a pro-survival response to necrotic death without the need for caspase 8 inhibition. We now identify CYLD as a substrate for caspase 8 that satisfies these criteria. Following TNF stimulation, caspase 8 cleaves CYLD to generate a survival signal. In contrast, loss of caspase 8 prevented CYLD degradation, resulting in necrotic death. A CYLD substitution mutation at Asp 215 that cannot be cleaved by caspase 8 switches cell survival to necrotic cell death in response to TNF.