Expression of the Dictyostelium discoideum pst-cath (CP2) gene is transcriptionally regulated during multicellular development, and the gene is inducible in competent single cells following administration of exogenous cAMP. The 5' flanking region of pst-cath (CP2) that extends from -313 to the Cap site (+1) has previously been shown to contain sufficient cis-acting regulatory elements for proper developmental and cAMP-inducible expression of a foreign gene [Datta and Firtel, 1987, Mol Cell Biol 7:149-159]. The -283 to -201 region includes two exceptional "G-boxes" centered at -233 and -217 respectively, and this approximately 80 bp region is essential for basal as well as regulated expression of the pst-cath (CP2) gene. Here we summarize results obtained from a detailed analysis of a series of linker-scanner mutants and mutants that carry small internal deletions within the essential 80-bp region. Insertion of a synthetic oligonucleotide that includes the downstream G-box is demonstrated to rescue a low level of cAMP-inducible expression following insertion into cassette mutants. The effect of introducing a change in the relative spacing between regulatory elements has also been investigated. We have analyzed nuclear extracts for the presence of DNA-binding proteins that interact specifically with the pst-cath (CP2) regulatory region and identified two such putative trans-acting factors: 1) the AT-factor that is observed within a few hours following the onset of starvation and that binds tightly to stretches of alternating adenine-thymine residues (poly(dA-dT]; and 2) the AG-factor that is present in nuclear extracts of aggregated cells. Competition studies have demonstrated significant differences in the affinity that characterizes the binding of the two factors to G-box-containing sequences. The binding specificities of these DNA-binding proteins have been analyzed using gel mobility-shift and DNaseI footprinting assays.