Mutations in the suppressor of Hairy-wing [su(Hw)] gene of Drosophila melanogaster can cause female sterility and suppress mutations that are insertions of the gypsy retrotransposon. Gypsy binds the protein (SUHW) encoded by su(Hw), and SUHW prevents enhancers promoter-distal to gypsy from activating gene transcription. SUHW contains 12 zinc fingers flanked by acidic N-and C-terminal domains. We examined the roles of each of the 12 zinc fingers in binding gypsy DNA and classified them into four groups: essential (fingers 6 through 10); beneficial but nonessential (fingers 1, 2, 3, and 11); unimportant (fingers 5 and 12); and inhibitory (finger 4). Because finger 10 is not required for female fertility but is essential for binding gypsy, these results imply that the SUHW-binding sites required for oogenesis differ in sequence from the gypsy-binding sites. We also examined the functions of the N-and C-terminal domains of SUHW by determining the ability of various deletion mutants to support female fertility and to alter expression of gypsy insertion alleles of the yellow, cut, forked, and Ultrabithorax genes. No individual segment of the N-and C-terminal domains of SUHW is absolutely required to alter expression of gypsy insertion alleles. However, the most important domain lies between residues 737 and 880 in the C-terminal domain. This region also contains the residues required for female fertility, and the fertility domain may be congruent with the enhancer-blocking domain. These results imply that SUHW blocks different enhancers and supports oogenesis by the same or closely related molecular mechanisms. Several spontaneous mutations in Drosophila melanogasterare insertions of the gypsy retrotransposon into or next to a gene (42). Expression of the phenotypes of gypsy insertion alleles can be suppressed to wild-type or near wild-type levels by suppressor of Hairy-wing [su(Hw)] mutations (42, 54). Other than suppression of gypsy insertions, female sterility is the only known phenotype associated with su(Hw) mutations (38).su(Hw) encodes a protein (SUHW) with 12 zinc finger motifs (44) that binds to a repeated consensus sequence downstream of the 5Ј long terminal repeat (LTR) of gypsy (11,61). Gypsy and the SUHW protein bound to gypsy can alter gene expression by multiple mechanisms. When gypsy is in a transcribed region of a gene and oriented in the same (parallel) direction, primary gene transcripts can be truncated and processed at the polyadenylation sites in the gypsy LTRs (13). Binding of SUHW to gypsy increases polyadenylation of gene transcripts in the 5Ј LTR (11, 13). Truncation of gene transcripts in gypsy occurs in parallel gypsy insertions in the achaete-scute complex (3) and the forked gene (29). The gypsy LTR poly(A) sites may also explain why parallel gypsy insertions in an intron of the Ultrabithorax gene display stronger phenotypes than antiparallel insertions (47).SUHW also alters gene expression by preventing enhancers and silencers from activating or repressing transcription (1,2,12,19,20,28,3...