A functional cDNA cloning system was developed by using a retrovirus library encoding CD8-chimeric proteins and a nuclear factor of activated T cells (NFAT)-GFP reporter cell line to identify molecules inducing NFAT activation. By using this strategy, NFAT activating molecule 1 (NFAM1) was cloned as an immunoreceptor tyrosine-based activation motif (ITAM)-bearing cell surface molecule belonging to the Ig superfamily and is predominantly expressed in spleen B and T cells. NFAM1 crosslinking induced ITAM phosphorylation, ZAP-70/Syk recruitment, NFAT activation, and cytokine production. In vivo overexpression of NFAM1 in bone marrow chimeras and transgenic mice induced severe impairment of early B cell development in an ITAM-dependent manner. In NFAM1-expressing B cells, B cell antigen receptor stimulation induced NFAM1 translocation to lipid raft, and NFAM1 co-crosslinking augmented B cell antigen receptor signaling. The results suggest that NFAM1 modulates B cell signaling through its ITAM, which regulates B cell development.