The Drosophila proliferating cell nuclear antigen promoter contains multiple transcriptional regulatory elements, including upstream regulatory element (URE), DNA replication-related element, E2F recognition sites, and three common regulatory factor for DNA replication and DNA replication-related element-binding factor genes recognition sites. In nuclear extracts of Drosophila embryos, we detected a protein factor, the UREbinding factor (UREF), that recognizes the nucleotide sequence 5-AAACCAGTTGGCA located within URE. Analyses in Drosophila Kc cells and transgenic flies revealed that the UREF-binding site plays an important role in promoter activity both in cultured cells and in living flies. A yeast one-hybrid screen using URE as a bait allowed isolation of a cDNA encoding a transcription factor, Grainyhead/nuclear transcription factor-1 (GRH/NTF-1). The nucleotide sequence required for binding to GRH was indistinguishable from that for UREF detected in embryo nuclear extracts. Furthermore, a specific antibody to GRH reacted with UREF in embryo nuclear extracts. From these results we conclude that GRH is identical to UREF. Although GRH has been thought to be involved in regulation of differentiation-related genes, this study demonstrates, for the first time, involvement of a GRH-binding site in regulation of the DNA replication-related proliferating cell nuclear antigen gene.The proliferating cell nuclear antigen (PCNA) 1 is required for replication of simian virus 40 (SV40) (1) as well as cellular DNA (2, 3). It has been proposed to function as a sliding clamp at DNA replication forks (4) and is also involved in DNA repair (5, 6) and cell cycle regulation (7-9) by interacting with various enzymes and regulatory proteins (10, 11). A possible role of PCNA in marking of DNA for chromatin assembly has also been proposed (12,13).In previous studies of the Drosophila genes for PCNA and DNA polymerase âŁ, we found a common 8-base pair sequence named the DNA replication-related element (DRE) (14 -16), which appeared to be an important regulatory element not only for these two DNA replication-related genes but also for various other cell cycle-(17) and cell proliferation-related genes (18,19). We also identified a specific DRE-binding factor (DREF) in Drosophila melanogaster (14). The cDNAs and genes for D. melanogaster (20) and Drosophila virilis (21) DREF proteins have been cloned and characterized. Various in vivo experiments have revealed that DRE is essential for the function of the PCNA promoter both in embryos and in larvae (15,22).We have also identified two E2F recognition sites (nucleotide positions ÏȘ56 to ÏȘ36 with respect to the cap site) in the region downstream of the PCNA gene DRE (ÏȘ100 to ÏȘ93) (23). Multiple E2F sites have been also identified in the promoters of the Drosophila DNA polymerase ⣠180-kDa subunit (24) and the 73-kDa subunit (16). In mammals, E2F and its heterodimeric partner DP associate to E2F sites for activation of the target genes (25). cDNAs have been cloned for the Drosophila counte...