IkappaB kinase (IKK) complex is a key regulator of NF-kappaB pathways. Signal-induced interaction of the IKKgamma (NEMO) subunit with the C-terminal IKKgamma/NEMO-binding domain (gammaBD) of IKKbeta is an essential interaction for IKK regulation. Underlying regulatory mechanism(s) of this interaction are not known. Phosphorylation of gammaBD has been suggested to play a regulatory role for IKK activation. However, a kinase that phosphorylates gammaBD has not been identified. In this study, we used a C-terminal fragment of IKKbeta as substrate and purified Polo-like kinase 1 (Plk1) from HeLa cell extracts by standard chromatography as a gammaBD kinase. Plk1 phosphorylates serines 733, 740, and 750 in the gammaBD of IKKbeta in vitro. Phosphorylating gammaBD with Plk1 decreased its affinity for IKKgamma in pulldown assay. We generated phosphoantibodies against serine 740 and showed that gammaBD is phosphorylated in vivo. Expressing a constitutively active Plk1 in mammalian cells reduced tumor necrosis factor (TNF)-induced IKK activation, resulting in decreased phosphorylation of endogenous IkappaBalpha and reduced NF-kappaB activation. To activate endogenous Plk1, cells were treated with nocodazole, which reduced TNF-induced IKK activation, and increased the phosphorylation of gammaBD. Knocking down Plk1 in mammalian cells restored TNF-induced IKK activation in nocodazole-treated cells. Activation of Plk1 inhibited TNF-induced expression of cyclin D1. In cells in which Plk1 was knocked down, TNFalpha increased expression of cyclin D1 and the proportion of cells in the S phase of the cell cycle. Taken together, this study shows that phosphorylation regulates the interaction of gammaBD of IKKbeta with IKKgamma and therefore plays a critical role for IKK activation. Moreover, we identify Plk1 as a gammaBD kinase, which negatively regulates TNF-induced IKK activation and cyclin D1 expression, thereby affecting cell cycle regulation. Untimely activation of cyclin D1 by TNFalpha can provide a potential mechanism for an involvement of TNFalpha in inflammation-induced cancer.