DJ-1, which is linked to recessively inherited Parkinson's disease when mutated, is a multi-functional protein with anti-oxidant and transcription regulatory activities. However, the mechanism(s) through which DJ-1 and the genes it regulates provide neuroprotection is not fully understood. Here, we show that wild-type DJ-1 induces the expression of thioredoxin 1 (Trx1), a protein disulfide oxidoreductase, whereas pathogenic mutant isoforms L166P and M26I cannot. Conversely, DJ-1 knockdown in SH-SY5Y cells and DJ-1 knockout in mice result in significant decrease in Trx1 protein and mRNA expression levels. The importance of Trx1 in the cytoprotective function of DJ-1 is confirmed using a pharmacological inhibitor of Trx reductase, 1-chloro-2,4-dinitrobenzene, and Trx1 siRNA. Both approaches result in partial loss of DJ-1-mediated protection. Additionally, knockdown of Trx1 significantly abrogates DJ-1-dependent, hydrogen peroxide-induced activation of the pro-survival factor AKT. Promoter analysis of the human Trx1 gene identified an antioxidant response element (ARE) that is required for DJ-1-dependent induction of Trx1 expression. The transcription factor Nuclear factor erythroid-2 related factor 2 (Nrf2), which is a critical inducer of ARE-mediated expression, is regulated by DJ-1. Overexpression of DJ-1 results in increased Nrf2 protein levels, promotes its translocation into the nucleus and enhances its recruitment onto the ARE site in the Trx1 promoter. Further, Nrf2 knockdown abolishes DJ-1-mediated Trx1 induction and cytoprotection against hydrogen peroxide, indicating the critical role of Nrf2 in carrying out the protective functions of DJ-1 against oxidative stress. These findings provide a new mechanism to support the antioxidant function of DJ-1 by increasing Trx1 expression via Nrf2-mediated transcriptional induction.