Luman/CREB3 (also called LZIP) is an endoplasmic reticulum (ER) membrane-bound transcription factor which is believed to undergo regulated intramembrane proteolysis in response to cellular cues. We previously found that Luman activates transcription from the unfolded protein response element. Here we report the identification of Herp, a gene involved in ER stress-associated protein degradation (ERAD), as a direct target of Luman. We found that Luman was transcriptionally induced and proteolytically activated by the ER stress inducer thaspsigargin. Overexpression of Luman activated transcription of cellular Herp via ER stress response element II (ERSE-II; ATTGG-N-CCACG) in the promoter region. Mutagenesis studies and chromatin immunoprecipitation assays showed that Luman physically associates with the Herp promoter, specifically the second half-site (CCACG) of ERSE-II. Luman was also necessary for the full activation of Herp during the ER stress response, since Luman small interfering RNA knockdown or functional repression by a dominant negative mutant attenuated Herp gene expression. Like Herp, overexpression of Luman protected cells against ER stress-induced apoptosis. With Luman structurally similar to ATF6 but resembling XBP1 in DNA-binding specificities, we propose that Luman is a novel factor that plays a role in ERAD and a converging point for various signaling pathways channeling through the ER.