Inhibitor of apoptosis protein (IAP) is a family of intracellular proteins that plays an essential role in the regulation of apoptosis. Recently, we and others discovered a new member of this family, termed Livin. Many studies have focused on the inhibitory effect of IAPs on caspases. Here, we describe a novel regulatory mechanism by which Livin is cleaved by the caspases. Strikingly, the cleaved Livin, although containing intact baculovirus IAP repeat and RING domains, does not only lose its antiapoptotic function but also gains a proapoptotic effect. The cleavage is site specific at Asp-52 and is restricted to effector caspase-3 and -7. Most importantly, we demonstrate the role of Livin and this regulatory mechanism in the drug resistance of melanoma patients. Using primary cultures derived from melanoma patients, we found a correlation between Livin overexpression, in vitro drug resistance, and the patient's clinical response.