A synthetic, 23-bp ecdysterone regulatory element (EcRE), derived from the upstream region of the Drosophila melanogaster hsp27 gene, was inserted adjacent to the herpes simplex virus thymidine kinase promoter fused to a bacterial gene for chloramphenicol acetyltransferase (CAT). Hybrid constructs were transfected into Drosophila S3 cells and assayed for ecdysterone-inducible CAT expression. In the absence of ecdysterone a tandem pair of EcREs repressed the high constitutive level of CAT activity found after transfection with the parent reporter plasmid alone. After hormone addition very high levels of CAT activity were observed. Insertion of the EcRE pair 3' of the CAT gene also led to high levels of ecdysterone-induced CAT expression, but the repression of high constitutive levels of CAT activity failed to occur. The EcRE-CAT construct was cotransfected with plasmids containing tandem 10-mers or 40-mers of the EcRE but lacking a reporter gene. These additional EcREs led to a reduced level of ecdysterone-induced CAT activity and to an elevation of basal CAT activity in the absence of hormone. The data suggest that the receptor binds to the EcRE in the absence of hormone, blocking basal transcription from a constitutive promoter. In the presence of ecdysterone, receptor-hormone binding to the EcRE leads to greatly enhanced transcription.