X-linked Inhibitor of Apoptosis (XIAP) deficiency predispose people to pathogen-associated hyperinflammation. Upon XIAP loss, Toll-like receptor (TLR) ligation triggers RIPK3-caspase-8-mediated IL-1β activation and cell death in myeloid cells. How XIAP suppresses these events is unclear. We now show that TLR-MyD88 signalling causes the proteasomal degradation of the related IAP, cIAP1, and its adaptor, TRAF2, by inducing TNF and TNF Receptor 2 (TNFR2) signalling. Genetically, we define that cIAP1 loss is required to promote RIPK3-caspase-8-mediated inflammatory events in the absence of XIAP. Importantly, loss of TNFR2 in XIAP-deficient macrophages limits TLR-MyD88-induced cIAP1 degradation, cell death and IL-1β activation. These data reveal that a TLR-MyD88-TNF-TNFR2 axis drives cIAP1-TRAF degradation to allow TLR or TNFR1 signalling to activate RIPK3-caspase-8 and IL-1β upon XIAP loss. This mechanism may explain why XIAP-deficient patients can exhibit symptoms reminiscent of patients with activating inflammasome mutations.