Iodoacetic acid (IAA) is an unregulated drinking-water disinfection byproduct with potent cytotoxicity, genotoxicity, and tumorigenicity in animals. Oxidative stress is thought to be essential for IAA toxicity, but the exact mechanism remains unknown. Here we evaluated the toxicity of IAA by examining nuclear factor E2-related factor 2 (Nrf2)-mediated antioxidant response, luciferase antioxidant response element (ARE) activity, and intracellular glutathione (GSH) in HepG2 cells. IAA showed significant activation of ARE-luciferase reporter, mRNA, and protein expression of Nrf2 and its downstream genes (GCLC, NQO1, and HO-1). IAA also increased the intracellular GSH level in HepG2 cells in a time- and concentration-dependent manner. Moreover, we verified IAA induced Nrf2-mediated antioxidant response in rats. Subsequently, we confirmed the specific role of Nrf2 in IAA induced toxicity using NRF2-knockdown cells. Deficiency of NRF2 significantly enhanced sensitivity to IAA toxicity and led to an increase of IAA induced micronulei. We also examined the effects of antioxidant on Nrf2-mediated response in IAA treated cells. Pretreatment with curcumin markedly reduced cytotoxicity and genotoxicity (micronuclei formation) IAA in HepG2 cells. Our work here provides direct evidence that IAA activates Nrf2-mediated antioxidant response in vitro and in vivo and that oxidative stress plays a role in IAA toxicity.