We previously demonstrated that ubiquitously expressed CP2c exerts potent erythroid-specific transactivation of alpha-globin through an unknown mechanism. This mechanism is reported here to involve specific CP2 splice variants and protein inhibitor of activated STAT1 (PIAS1). We identify a novel murine splice isoform of CP2, CP2b, which is identical to CP2a except that it has an additional 36 amino acids encoded by an extra exon. CP2b has an erythroid cell-specific transcriptional activation domain, which requires the extra exon and can form heteromeric complexes with other CP2 isoforms, but lacks the DNA binding activity found in CP2a and CP2c. Transcriptional activation of alpha-globin occurred following dimerization between CP2b and CP2c in erythroid K562 and MEL cells, but this dimerization did not activate the alpha-globin promoter in nonerythroid 293T cells, indicating that an additional erythroid factor is missing in 293T cells. PIAS1 was confirmed as a CP2 binding protein by the yeast two-hybrid screen, and expression of CP2b, CP2c, and PIAS1 in 293T cell induced alpha-globin promoter activation. These results show that ubiquitously expressed CP2b exerts potent erythroid cell-specific alpha-globin gene expression by complexing with CP2c and PIAS1.