During pancreatic development, the paired homeodomain transcription factor PAX4 is required for the differentiation of the insulin-producing beta cells and somatostatin-producing delta cells. To establish the position of PAX4 in the hierarchy of factors controlling islet cell development, we examined the control of the human PAX4 gene promoter. In both cell lines and transgenic animals, a 4.9-kilobase pair region directly upstream of the human PAX4 gene transcriptional start site acts as a potent pancreas-specific promoter. Deletion mapping experiments demonstrate that a 118-base pair region lying approximately 1.9 kilobase pairs upstream of the transcription start site is both necessary and sufficient to direct pancreas-specific expression. Serial deletions through this region reveal the presence of positive elements that bind several pancreatic transcription factors as follows: the POU homeodomain factor HNF1␣, the orphan nuclear receptor HNF4␣, the homeodomain factor PDX1, and a heterodimer composed of two basic helix-loop-helix factors. Interestingly, mutations in the genes encoding four of these factors cause a dominantly inherited form of human diabetes called Maturity Onset Diabetes of the Young. In addition, PAX4 itself has at least two high affinity binding sites within the promoter through which it exerts a strong negative autoregulatory effect. Together, these results suggest a model in which PAX4 expression is activated during pancreatic development by a combination of pancreas-specific factors but is then switched off once PAX4 protein reaches sufficient levels.Organogenesis of the mammalian pancreas and its differentiation into discrete populations of endocrine and exocrine cells depends on the tightly regulated temporal and spatial expression of an array of transcription factors (for reviews see Refs. 1-3). Some of these factors, such as HNF3 (4, 5), PDX1 (6, 7), and HLXb9 (8, 9), are involved in the formation and outgrowth of the dorsal and ventral pancreatic buds. Within the forming pancreas, the basic helix-loop-helix transcription factor neurogenin3 functions as a pro-endocrine gene, initiating the program of endocrine differentiation in selected cells (10, 11). The complete differentiation and maturation of the endocrine cells requires additional factors, including neuroD1/BETA2 (12), NKX2.2 (13), ISL1 (14), and PAX6 (2, 15).Once neurogenin3 expression sets a progenitor cell on a course of endocrine differentiation, additional factors are necessary to determine which of the four endocrine cell types it will become. One of these islet cell-type determination factors is the paired homeodomain transcription factor PAX4. PAX4 functions as a potent transcriptional repressor and is expressed only transiently in the fetal pancreas, peaking during the period of beta and delta cell differentiation (16). Mice with a targeted disruption of the pax4 gene have a marked decrease in beta and delta cells with a commensurate increase in alpha cells (17), suggesting that PAX4 functions by repressing the alpha...