NOD2 is an intracellular receptor for the bacterial cell wall component muramyl dipeptide (MDP), and variants of NOD2 are associated with chronic inflammatory diseases of barrier organs (e.g., Crohn's disease, asthma, and atopic eczema). It is known that activation of NOD2 induces a variety of inflammatory and antibacterial factors. The exact transcriptomal signatures that define the cellular programs downstream of NOD2 activation and the influence of the Crohn-associated variant L1007fsinsC are yet to be defined. To describe the MDP-induced activation program, we analyzed the transcriptomal reactions of isogenic HEK293 cells expressing NOD2(wt) or NOD2(L1007fsinsC) to stimulation with MDP. Importantly, a clear loss of function could be observed in the cells carrying the Crohn-associated variant L1007fsinsC, whereas the NOD2(wt) cells showed differential regulation of growth factors, chemokines, and several antagonists of NF-κB (e.g., TNFAIP3 [A20] and IER3). This genotype-dependent regulation pattern was confirmed in primary human myelomonocytic cells. The influence of TNFAIP3 and IER3 in the context of NOD2 signaling was characterized, and we could validate the predicted role as inhibitors of NOD2-induced NF-κB activation. We show that IER3 impairs the protective effect of NOD2(wt) against bacterial cytoinvasion. These results further our understanding of NOD2 as a first-line defense molecule and emphasize the importance of simultaneous upregulation of counterregulatory anti-inflammatory factors as an integral part of the NOD2-induced cellular program. Lack of these regulatory events due to the L1007fsinsC variant may pivotally contribute to the induction and perpetuation of chronic inflammation.