The Drosophila chorion factor 1/ultraspiracle (CF1/USP) transcription factor, a homologue of the retinoid X receptor, is a developmentally important member of the family of nuclear (steroid) hormone receptors. Using newly developed monoclonal antibodies and a full-length bacterially produced protein, we have studied in detail the in vitro DNAbinding properties of this factor and aspects of its distribution in vivo. During oogenesis, CF1/USP is present both in germline cells and in the somatic follicular epithelium. We have determined the optimal binding site of partially purifiled bacterially produced CF1/USP by an in vitro selection procedure and also have characterized its binding to the follicular-specific chorion siS promoter. In vito this bacterially produced factor is unusual in binding to a single element ("half-site"); simultaneous but noncoordinate binding to a second half-site is possible if these repeated elements are organized in direct orientation and spaced adequately. However, the factor interacts synergistically with several other nuclear hormone receptors: notably, it can form in vito heteromers with mammalian thyroid and retinoic acid receptors, binding to two half-sites that are organized in either direct or inverted orientation. In vivo the factor most probably functions as a heterodimer, but its partner(s) remains to be determined.Steroid and other nuclear hormone receptors are a family of ligand-modulated transcription factors that regulate cell differentiation and development as well as homeostasis and reproduction (1, 2). These receptors bind to DNA promoter or enhancer motifs ("hormone response elements" or HRE), which typically contain two copies of short, receptor-specific sequences called "half-sites," oriented either as direct (e.g., refs. 3-5) or as inverted (e.g., refs. 6 and 7) repeats. Although some members of the family bind to HREs as homodimers, others can heterodimerize, potentially enhancing the range of regulatory processes that can be served by a single HRE (8).In Drosophila melanogaster, the paradigm for metazoan genetics, nine members of this family have been identified so far, with strategic roles in embryogenesis, postembryonic development, and morphogenesis (2). We first cloned one of these factors by its binding to a potential HRE in the chorion siS promoter and named it chorion factor 1 (CF1) (9); this receptor was also cloned independently by homology to the DNA-binding domain of vertebrate hormone receptors (10,11). This orphan receptor, CF1/USP, is encoded by the ultraspiracle locus (usp) (10), a maternally and zygotically required gene with multiple functions in development (12). CF1/USP is most closely related to the subfamily of vertebrate retinoid X receptors (RXRs), suggesting that its ligand might be a retinoid metabolite (13)(14)(15).