FADD protein is a critical mediator of signal transduction pathways activated by several members of the TNF-receptor gene superfamily. Recently, an induced proximity model has been proposed to interpret FADD-mediated signaling events. According to this model, FADD facilitates signaling by inducing clusters of effector molecules in proximity of the activated receptor complex. An important corollary of the induced-proximity model is that FADD protein should not form oligomers in the absence of receptor stimulation. Here we show that, in the absence of death receptor stimulation, FADD is found associated to the alpha chain of the nascent polypeptide-associated complex (NAC). Exposure to TNF results in disruption of FADD/NAC complex. Expression of NAC regulates formation of FADD oligomers and modulates FADD-mediated signaling. Thus, our observation indicates that NAC may serve as an intracellular regulator of FADD function.