Polymorphisms in NOD2 (CARD15) are associated with ileal and ileocolonic Crohn's disease, increased mortality from graft-versus-host disease, and Blau syndrome. NOD2 activation by peptidoglycan components initiates various signaling pathways and CD-associated NOD2 mutations are associated with decreased activation of NF-kappaB. NOD2 may be important for both initial defenses against commensal and pathogenic bacteria and tolerance mechanisms for maintaining controlled activation of the intestinal immune system. Significant progress has been made in defining NOD2 signaling partners and pathways and functional consequences of NOD2 mutations with respect to its activation, expression, signaling, synergistic effects with Toll-like receptor signaling, and antimicrobial effects. However, NOD2 contributions to human intestinal inflammation are complex and incompletely understood. Improved understanding of NOD2-mediated pathways may lead to identification of other molecules that can also contribute to the development of Crohn's disease in humans.