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Background Genetic predisposition to inflammatory bowel disease (IBD) has been shown by epidemiological and linkage studies. Genetic linkage of IBD to chromosome 16 has been previously observed and replicated in independent populations. The recently identified NOD2 gene is a good positional and functional candidate gene since it is located in the region of linkage on chromosome 16q12, and activates nuclear factor (NF) kappaB in response to bacterial lipopolysaccharides. Methods We sequenced the coding region of the NOD2 gene and genotyped an insertion polymorphism affecting the leucine-rich region of the protein product in 512 individuals with IBD from 309 German or British families, 369 German trios (ie, German patients with sporadic IBD and their unaffected parents), and 272 normal controls. We then tested for association with Crohn's disease and ulcerative colitis. Findings Family-based association analyses were consistently positive in 95 British and 99 German affected sibling pairs with Crohn's disease (combined p<0.0001); the association was confirmed in the 304 German trios with Crohn's disease. No association was seen in the 115 sibling pairs and 65 trios with ulcerative colitis. The genotype-specific disease risks conferred by heterozygous and homozygous mutant genotypes were 2.6 (95% CI 1.5-4.5) and 42.1 (4.3-infinity), respectively. Interpretation The insertion mutation in the NOD2 gene confers a substantially increased susceptibility to Crohn's disease but not to ulcerative colitis.