Tumor necrosis factor (TNF) receptor–associated factor 3 (TRAF3) regulates both innate and adaptive immunity by modulating signaling by Toll-like receptors (TLR) and TNF receptors. TRAF3 was recently identified as a tumor suppressor in human multiple myeloma, suggesting a prominent role in plasma cell homeostasis. We have generated transgenic mice expressing human TRAF3 in lymphocytes. These mice are normal at birth, but they develop over time plasmacytosis and hypergammaglobulinemia, as well as systemic inflammation and tertiary lymphoid organ formation. The analysis of the humoral responses of the TRAF3 mice demonstrated increased responses to T-dependent and T-independent antigens with increased production of antigen-specific immunoglobulin Gs (IgGs) compared with wild-type mice. Furthermore, TLR-mediated IgG production is also increased in TRAF3 B cells. In addition, TRAF3 mice develop autoimmunity and are predisposed to cancer, particularly squamous cell carcinomas of the tongue (≈ 50% incidence) and salivary gland tumors. In summary, TRAF3 renders B cells hyperreactive to antigens and TLR agonists, promoting autoimmunity, inflammation, and cancer, hereby providing a new model for studying de novo carcinogenesis promoted by B cell–initiated chronic inflammation.