Human CMV (HCMV) is a widespread human pathogen that causes blindness by inducing retinitis in AIDS patients. Previously, we showed that viral immediate early 2 (IE2) protein may allow HCMV to evade the immune control by killing the Fas receptor-positive T lymphocytes attracted to the infected retina with increased secretion of Fas ligand (FasL). In this study, we further demonstrate that the secreted FasL also kills uninfected Fas-rich bystander retinal cells and that IE2 simultaneously protects the infected cells from undergoing apoptotic death, in part, by activating the expression of cellular FLIP (c-FLIP), an antiapoptotic molecule that blocks the direct downstream executer caspase 8 of the FasL/Fas pathway. c-FLIP induction requires the N-terminal 98 residues of IE2 and the c-FLIP promoter region spanning nucleotides -978 to -696. In vivo association of IE2 to this region, IE2-specific c-FLIP activation, and decrease of FasL-up-regulated activities of caspases 8 and 3 were all demonstrated in HCMV-infected human retinal cells. Moreover, c-FLIP up-regulation by IE2 appeared to involve PI3K and might also render cells resistant to TRAIL-mediated death. Finally, enhanced c-FLIP signals were immunohistochemicaly detected in IE-positive cells in the HCMV-infected lesions of the human retina. Taken together, these data demonstrate specific activation of c-FLIP by HCMV IE2 and indicate a novel role for c-FLIP in the pathogenesis of HCMV retinitis.