Crohn's disease is a chronic inflammatory disorder of the gastrointestinal tract, which is thought to result from the effect of environmental factors in a genetically predisposed host. A gene location in the pericentromeric region of chromosome 16, IBD1, that contributes to susceptibility to Crohn's disease has been established through multiple linkage studies, but the specific gene(s) has not been identified. NOD2, a gene that encodes a protein with homology to plant disease resistance gene products is located in the peak region of linkage on chromosome 16 (ref. 7). Here we show, by using the transmission disequilibium test and case-control analysis, that a frameshift mutation caused by a cytosine insertion, 3020insC, which is expected to encode a truncated NOD2 protein, is associated with Crohn's disease. Wild-type NOD2 activates nuclear factor NF-kappaB, making it responsive to bacterial lipopolysaccharides; however, this induction was deficient in mutant NOD2. These results implicate NOD2 in susceptibility to Crohn's disease, and suggest a link between an innate immune response to bacterial components and development of disease.