b-Site APP cleaving enzyme 1 (BACE1) is an essential enzyme for the production of b amyloid. Since we found that injection of interferon-g (IFN-g) into young mouse brains increased BACE1 expression in astrocytes, we investigated molecular mechanisms underlying this process by cloning a putative BACE1 promoter. BACE1 promoter activity was differentially regulated by IFN-g in a region specific manner and down-regulated by an inhibitor of Janus kinase 2 (JAK2). A dominant negative mutant of signal transducer and activator of transcription 1 (STAT1) expression suppressed BACE1 promoter activity, and this was rescued by transfecting wild type STAT1. Electrophoretic mobility shift assay and promoter activity assays indicated that STAT1 binds directly to the putative STAT1 binding sequence of BACE1 promoter. Because IFN-g treatment induced STAT1 phosphorylation, we examined whether the expression of a suppressor of cytokine signaling (SOCS), negative regulator of JAK2, suppresses BACE1 promoter activity. The results show that SOCS1 or SOCS3 expression suppressed BACE1 promoter by blocking phosphorylation of Tyr701 residue in STAT1. Also, because IFN-g treatment specifically potentiated extracellular signal regulated MAP kinase (ERK) 1/2 activation, pretreatment of mitogen-activated or extracellular signal-regulated protein kinase (MEK) inhibitor, PD98059, significantly attenuated IFN-g-induced BACE1 promoter activity and protein expression through blocking phosphorylation of Ser727 residue in STAT1, suggesting that ERK1/2 is associated with IFN-g-induced STAT1 signaling cascade. Taken together, our results suggest that IFN-g activates JAK2 and ERK1/2 and then phosphorylated STAT1 binds to the putative STAT1 binding sequences in BACE1 promoter region to modulate BACE1 protein expression in astrocytes. V V C 2006 Wiley-Liss, Inc.