Caspases are essential mediators of cytokine release and apoptosis. Additionally, caspase activity is required for the proliferation of naive T lymphocytes. It remained unclear how proliferating cells are able to cope with the pro-apoptotic activity especially of effector caspases-3 and -7. Possible reasons might include limited subcellular localization of active caspases or inhibition by endogenous caspase inhibitors. Here, we compared the activation of various caspases in proliferating human T cells with that in apoptotic cells. We show that cleaved caspases-3/-7 appear to be widely distributed in apoptotic cells while they are largely confined to the cytoplasm in proliferating cells. Additionally, in proliferating T cells caspase-3 remains incompletely cleaved, while in apoptotic cells fully mature caspase-3 is generated. We provide evidence that during T cell proliferation the intracellular caspase inhibitor X-linked inhibitor-of-apoptosis protein (XIAP) interacts with caspases-3/-7, thereby blocking their full activation, substrate cleavage, and cell death. The lack of substrate cleavage might also lead to the observed limited subcellular distribution of caspases-3/-7. After induction of apoptosis, second mitochondria-derived activator of caspases/direct inhibitor of apoptosis-binding protein with low isoelectric point (Smac/DIABLO) is released from mitochondria, resulting in the abrogation of the inhibitory effect of XIAP, full activation of caspases-3/-7, and apoptosis.