Escherichia coli integration host factor (IHF), a DNA-binding protein, positively regulates expression of the lambda cII gene. Purified IHF stimulates cII protein synthesis in vitro, suggesting a direct role for host factor in cII expression. Further evidence for a direct role for IHF was obtained with operon and gene fusions between cII and lacZ or cII and galE. Analysis of these fusions in vivo demonstrated that IHF is essential for the initiation of cII translation. Replacement of the entire cII coding sequence with lacZ yielded a gene fusion which was still IHF dependent. However, a cII-galE fusion carrying a hybrid ribosome binding region expressed galE in IHF mutants. These results indicate that sequences which make cII translation IHF dependent lie between the ribosome binding region and the initiating codon of cII. Failure to translate cII activates a transcription terminator located within cII and results in polar effects on downstream transcription. This polarity is suppressed by the lambda N antitermination function. When cloned into another context, the terminator is active in both wild-type and IHF mutant strains. The amino terminus of cII is located near an IHF binding site in a region with considerable dyad symmetry. The role of IHF in cII translation may be to prevent formation of an RNA-RNA duplex that sequesters the ribosome binding site of cII. The binding of IHF might influence RNA structure by altering the rate of the dissociation of RNA from the DNA template.