Inhibition of class II trans-activator (CIITA) expression prevents embryonic trophoblast cells from up-regulating MHC class II genes in response to IFN-γ. This is thought to be one mechanism of maternal tolerance to the fetal allograft. The CIITA gene is regulated by four distinct promoters; promoter III directs constitutive (B cell) expression, and promoter IV regulates IFN-γ-inducible expression. Using in vivo genomic footprinting, promoter-reporter analysis, Southern blot analysis, and RT-PCR, we have examined the cause of CIITA silencing in a trophoblast-derived cell line. We report here that methylation of promoter IV DNA at CpG sites in Jar cells prevents promoter occupancy and IFN-γ-inducible transcription. The inhibition of CpG methylation in Jar cells by treatment with 5-aza-2′-deoxycytidine restores IFN-γ inducibility to CIITA. This is the first description of an epigenetic mechanism involved in regulation of CIITA and MHC class II gene expression.