A genetic selection method was developed for the cloning of positive-acting transcriptional regulatory genes in Saccharomyces cerevisiae. The method was applied for the isolation of activators of Trichoderma reesei (Hypocrea jecorina) cellulase genes. Activator genes were isolated from a T. reesei expression cDNA library on the basis of the ability of their translation products to activate transcription from the full-length T. reesei cbh1 promoter coupled to the S. cerevisiae HIS3 gene and to support the growth of the yeast colonies in the absence of histidine. Among the clones obtained was the ace1 gene encoding a novel polypeptide, ACEI, that contains three zinc finger motifs of Cys 2 -His 2 type. Possible ACEI homologues were found among expressed sequence tags of Aspergillus and Neurospora. The ability of ACEI to bind to the cbh1 promoter was further confirmed in the yeast one-hybrid system. In vitro binding and gel mobility shift assays revealed several binding sites for the ACEI protein in the cbh1 promoter. Disruption of the ace1 gene in T. reesei resulted in retarded growth of the fungus on a cellulose-containing medium, on which cellulases are normally highly expressed.The filamentous fungus Trichoderma reesei is well known for efficient production of cellulolytic enzymes and its powerful capacity to hydrolyze cellulose into glucose. It is an excellent cellulolytic model organism, and the cellulolytic system of T. reesei has become the best characterized among filamentous fungi in many respects. The enzymatic properties and threedimensional structures (1-4) of T. reesei cellulases, as well as the carbon source dependent regulation of cellulase gene expression (for a recent review, see Ref. 5), have been studied in detail by several groups. The activity of cellulase genes is controlled at the level of transcription: the genes are repressed in the presence of glucose and highly induced when cellulose, its derivatives, or certain oligosaccharides, such as sophorose, are present. Glucose repression is mediated by the CREI protein (6 -8), which has been shown to act directly on the promoter of the gene encoding the major cellulase cellobiohydrolase I (CBHI) (9). CREI also mediates repression of a number of other genes coding for enzymes involved in degradation of hemicellulose and cellulose (10). In addition to cre1, no other genes for transcription factors have been described in T. reesei. Based on the gene expression data, it can be concluded that a distinct induction pathway for cellulases must exist in T. reesei that is needed for high level transcription (11, 12), but the genes responsible for transcription activation are completely unknown. Furthermore, there is lack of knowledge about possible target sequences for cellulase-specific transcription activators from any filamentous fungi. The aim of this study was to identify genes encoding transcription activators involved in regulation of the activity of cellulase genes. For this purpose, we developed a genetic selection system that allowed us to isolat...