Inflammatory cytokines such as interleukin-1 and tumor necrosis factor-alpha modulate a transcription factor cascade in the liver to induce and sustain an acute and systemic defense against foreign entities. The transcription factors involved include NF-kappaB, STAT, and CCAAT/enhancer-binding protein (C/EBP). Whether the NFAT group of transcription factors (which was first characterized as playing an important role in cytokine gene expression in the adaptive response in immune cells) participates in the acute-phase response in hepatocytes is not known. Here, we have investigated whether NFAT is part of the transcription factor cascade in hepatocytes during inflammatory stress. We report that interleukin-1 or tumor necrosis factor-alpha increases expression of and activates NFATc2. C/EBP-mediated NFATc2 induction is temporally required for expression of type IIA secretory phospholipase A2. NFATc2 is also required for expression of phospholipase D1 and the calcium-binding protein S100A3. Thus, a C/EBP-NFATc2 transcription factor cascade provides an additional means to modulate the acute-phase response upon stimulation with inflammatory cytokines.