Systemic lupus erythematosus (SLE) is the prototypic systemic autoimmune disease. It is thought that many common variant gene loci of weak effect act additively to predispose to common autoimmune diseases, while the contribution of rare variants remains unclear. Here we describe that rare coding variants in lupus-risk genes are present in most SLE patients and healthy controls. We demonstrate the functional consequences of rare and low frequency missense variants in the interacting proteins BLK and BANK1, which are present alone, or in combination, in a substantial proportion of lupus patients. The rare variants found in patients, but not those found exclusively in controls, impair suppression of IRF5 and type-I IFN in human B cell lines and increase pathogenic lymphocytes in lupus-prone mice. Thus, rare gene variants are common in SLE and likely contribute to genetic risk.