TNFAIP8-like 2 (TIPE2) has an essential role in immune homeostasis, yet the underlying mechanism remains enigmatic. The high-resolution crystal structure of TIPE2 reveals a previously uncharacterized fold that is different from the predicted fold of a death effector domain (DED). Strikingly, TIPE2 contains a large, hydrophobic central cavity that is poised for cofactor binding. These structural features will be important for understanding the functions of TIPE2 and other TNFAIP8 family proteins.