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The Epstein-Barr virus (EBV) oncoprotein Latent Membrane Protein 1 (LMP1) is expressed in multiple malignancies and is critical for B-cell immortalization. LMP1 constitutively activates NF-κB signaling pathways, which are essential for EBV-mediated B cell transformation and for transformed B cell survival. Reverse genetic analysis revealed two LMP1 regions critical for primary human B cell immortalization, termed transformation effector site (TES) 1 and 2, which activate multiple host growth and survival pathways, in particular NF-κB. Of these, only TES1 signaling is required for B-cell transformation within the first several weeks of infection. TES1 signaling is also critical for EBV-transformed lymphoblastoid B-cell survival. However, precisely how TES1 initiates NF-κB signaling has remained incompletely understood. Here, we provide multiple lines of evidence that TES1 associates with cellular inhibitor of apoptosis protein 1 and 2 (cIAP1/2) in a tumor necrosis factor associated factor 3 (TRAF3) dependent manner. TES1 signaling drives cIAP1 autoubiquitination and targets TRAF2, cIAP1 and 2 for proteasomal degradation in a TRAF3 dependent manner. Overexpression of either cIAP1 or 2 impaired LMP1 TES1-mediated non-canonical NF-κB activation. Collectively, these studies suggest that LMP1 TES1 initiates non-canonical NF-κB signaling distinctly from CD40 and other host immunoreceptors, thereby highlighting a therapeutic target.