The regulation of the transcription factor nuclear factor-kappaB (NF-kappaB) during B-cell development was examined using cells isolated from the bone marrow of transgenic mice expressing a kappaB luciferase reporter gene. The results indicate that the highest level of NF-kappaB activity is present in cells expressing the pre-B-cell receptor. Furthermore, cross-linking of Igbeta on CD43(+) pre-B cells is able to activate NF-kappaB in recombination-activating gene 1-deficient mice, preceding their further differentiation into CD43(-) pre-B cells. Expression of a dominant negative form of IkappaBalpha using a transgenic approach or by retroviral infection leads to a reduction in the number of CD43(+) pre-B cells. These data therefore indicate that activation of NF-kappaB in CD43(+) pre-B cells, as a result of signaling by the pre-B-cell receptor, facilitates the continued development of large, CD43(+) pre-B cells into small CD43(-) pre-B cells.