The CATERPILLER (CLR/NLR) gene family encodes a family of putative nucleotide-binding proteins important for host defense. Although nucleotide binding is thought to be central to this family, this aspect is largely unstudied. The CATERPILLER protein cryopyrin/NALP3 regulates IL-1beta processing by assembling the multimeric inflammasome complex. Mutations within the exon encoding the nucleotide-binding domain are associated with hereditary periodic fevers characterized by constitutive IL-1beta production. We demonstrate that purified cryopyrin binds ATP, dATP, and ATP-agarose, but not CTP, GTP, or UTP, and exhibits ATPase activity. Mutation of the nucleotide-binding domain reduces ATP binding, caspase-1 activation, IL-1beta production, cell death, macromolecular complex formation, self-association, and association with the inflammasome component ASC. Disruption of nucleotide binding abolishes the constitutive activation of disease-associated mutants, identifying nucleotide binding by cryopyrin as a potential target for antiinflammatory pharmacologic intervention.