Plays a role of transcription factor; binds to recognition signal sequences (Rss heptamer) for somatic recombination of immunoglobulin and T-cell receptor gene segments; Binds also to the kappa-B motif of gene such as S100A4, involved in cell progression and differentiation. Kappa-B motif is a gene regulatory element found in promoters and enhancers of genes involved in immunity, inflammation, and growth and that responds to viral antigens, mitogens, and cytokines. Involvement of HIVEP3 in cell growth is strengthened by the fact that its down-regulation promotes cell cycle progression with ultimate formation of multinucleated giant cells. Strongly inhibits TNF-alpha-induced NF-kappa-B activation; Interferes with nuclear factor NF-kappa-B by several mechanisms: as transcription factor, by competing for Kappa-B motif and by repressing transcription in the nucleus; through a non transcriptional process, by inhibiting nuclear translocation of RELA by association with TRAF2, an adapter molecule in the tumor necrosis factor signaling, which blocks the formation of IKK complex. Interaction with TRAF proteins inhibits both NF-Kappa-B-mediated and c-Jun N-terminal kinase/JNK-mediated responses that include apoptosis and pro-inflammatory cytokine gene expression. Positively regulates the expression of IL2 in T-cell. Essential regulator of adult bone formation.