The nonsense mediated RNA decay (NMD) pathway safeguards the integrity of the transcriptome by targeting mRNAs with premature translation termination codons (PTCs) for degradation. It also regulates gene expression by degrading a large number of non-mutant RNAs (including mRNAs and noncoding RNAs) that bear NMD-inducing features. Consequently, NMD has been shown to influence development, cellular response to stress, and clinical outcome of many genetic diseases. Small molecules that can modulate NMD activity provide critical tools for understanding the mechanism and physiological functions of NMD, and they also offer potential means for treating certain genetic diseases and cancer. Therefore, there is an intense interest in identifying small-molecule NMD inhibitors or enhancers. It was previously reported that both inhibition of NMD and treatment with the AMPK-selective inhibitor Compound C (CC) induce autophagy in human cells, raising the possibility that CC may be capable of inhibiting NMD. Here we show that CC indeed has a NMD-inhibitory activity. Inhibition of NMD by CC is, however, independent of AMPK activity. As a competitive ATP analog, CC does not affect the kinase activity of SMG1, an essential NMD factor and the only known kinase in the NMD pathway. However, CC treatment down-regulates the protein levels of several NMD factors. The induction of autophagy by CC treatment is independent of ATF4, a NMD target that has been shown to promote autophagy in response to NMD inhibition. Our results reveal a new activity of CC as a NMD inhibitor, which has implications for its use in basic research and drug development.