  Motivated by possible implications on the problem of moduli stabilization and
other phenomenological aspects, we study D-brane instanton effects in flux
compactifications. We focus on a local model and compute non-perturbative
interactions generated by gauge and stringy instantons in a N = 1 quiver theory
with gauge group U(N_0) x U(N_1) and matter in the bifundamentals. This model
is engineered with fractional D3-branes at a C^3/(Z_2 x Z_2) singularity, and
its non-perturbative sectors are described by introducing fractional
D-instantons. We find a rich variety of instanton-generated F- and D-term
interactions, ranging from superpotentials and Beasley-Witten like
multi-fermion terms to non-supersymmetric flux-induced instanton interactions.
