Interleukin 1 receptor (IL-1R)-associated kinase-4 (IRAK-4) is required for various responses induced by IL-1R and Toll-like receptor signals. However, the molecular mechanism of IRAK-4 signaling and the role of its kinase activity have remained elusive. In this report, we demonstrate that IRAK-4 is recruited to the IL-1R complex upon IL-1 stimulation and is required for the recruitment of IRAK-1 and its subsequent activation/degradation. By reconstituting IRAK-4-deficient cells with wild type or kinase-inactive IRAK-4, we show that the kinase activity of IRAK-4 is required for the optimal transduction of IL-1-induced signals, including the activation of IRAK-1, NF-kappaB, and JNK, and the maximal induction of inflammatory cytokines. Interestingly, we also discover that the IRAK-4 kinase-inactive mutant is still capable of mediating some signals. These results suggest that IRAK-4 is an integral part of the IL-1R signaling cascade and is capable of transmitting signals both dependent on and independent of its kinase activity.