Bruton's tyrosine kinase (BTK) is a member of the Src-related Tec family of protein tyrosine kinases. Mutations in the btk gene have been linked to severe developmental blocks in human B-cell ontogeny leading to X-linked agammaglobulinemia. Here, we provide unique biochemical and genetic evidence that BTK is an inhibitor of the Fas/APO-1 death-inducing signaling complex in B-lineage lymphoid cells. The Src homology 2, pleckstrin homology (PH), and kinase domains of BTK are all individually important and apparently indispensable, but not sufficient, for its function as a negative regulator of Fas-mediated apoptosis. BTK associates with Fas via its kinase and PH domains and prevents the FAS-FADD interaction, which is essential for the recruitment and activation of FLICE by Fas during the apoptotic signal. Fas-resistant DT-40 lymphoma B-cells rendered BTK-deficient through targeted disruption of the btk gene by homologous recombination knockout underwent apoptosis after Fas ligation, but wild-type DT-40 cells or BTK-deficient DT-40 cells reconstituted with wild-type human btk gene did not. Introduction of an Src homology 2 domain, a PH domain, or a kinase domain mutant human btk gene into BTK-deficient cells did not restore the resistance to Fas-mediated apoptosis. Introduction of wild-type BTK protein by electroporation rendered BTK-deficient DT-40 cells resistant to the apoptotic effects of Fas ligation. BTK-deficient RAMOS-1 human Burkitt's leukemia cells underwent apoptosis after Fas ligation, whereas BTK-positive NALM-6-UM1 human B-cell precursor leukemia cells expressing similar levels of Fas did not. Treatment of the anti-Fas-resistant NALM-6-UM1 cells with the leflunomide metabolite analog alpha-cyano-beta-methyl-beta-hydroxy-N-(2, 5-dibromophenyl)propenamide, a potent inhibitor of BTK, abrogated the BTK-Fas association without affecting the expression levels of BTK or Fas and rendered them sensitive to Fas-mediated apoptosis. The ability of BTK to inhibit the pro-apoptotic effects of Fas ligation prompts the hypothesis that apoptosis of developing B-cell precursors during normal B-cell ontogeny may be reciprocally regulated by Fas and BTK.