Cellular BCL-2 family proteins can inhibit or induce programmed cell death in part by counteracting the activity of other BCL-2 family members. All sequenced gammaherpesviruses encode a BCL-2 homologue that potently inhibits apoptosis and apparently escapes some of the regulatory mechanisms that govern the functions of their cellular counterparts. Examples of these protective proteins include BHRF1 of Epstein-Barr virus (EBV) and KSBcl-2 of Kaposi's sarcoma-associated herpesvirus, also known as human herpesvirus 8. The gamma-1 subgroup of these viruses, such as EBV, encodes a second BCL-2 homologue. We have now found that this second BCL-2 homologue encoded by EBV, BALF1, inhibits the antiapoptotic activity of EBV BHRF1 and of KSBcl-2 in several transfected cell lines. However, BALF1 failed to inhibit the cellular BCL-2 family member, BCL-x(L). Thus, BALF1 acts as a negative regulator of the survival function of BHRF1, similar to the counterbalance observed between cellular BCL-2 family members. Unlike the cellular BCL-2 family antagonists, BALF1 lacked proapoptotic activity and could not be converted into a proapoptotic factor in a manner similar to cellular BCL-2 proteins by caspase cleavage or truncation of the N terminus. Coimmunoprecipitation experiments and immunofluorescence assays suggest that a minimal amount, if any, of the BHRF1 and BALF1 proteins colocalizes inside cells, suggesting that mechanisms other than direct interaction explain the suppressive function of BALF1.