We analyzed a set of adenovirus-simian virus 40 (SV40) hybrids in which the SV40 T antigen coding sequences are inserted downstream from the adenovirus major late promoter within the first, second, and third segments of the tripartite leader. In infected cells, these viruses give rise to a matched set of hybrid SV40 mRNAs that differ only in the number of tripartite leader segments attached to the complete SV40 T antigen coding region. We found that the number of tripartite leader segments present at the 5' end of the hybrid SV40 mRNAs had little effect on the efficiency of T antigen translation. Surprisingly, insertion of SV40 sequences within the first leader segment, at +33 relative to the start of transcription, significantly reduced the frequency of transcription initiation from the major late promoter. The 3' boundary of this downstream transcriptional control element was mapped between +33 and +190 by showing that insertion of SV40 sequences within the intron after the first leader segment at +190 had very little effect on transcription initiation from the late promoter. A transient expression assay was used to show that the effect of downstream sequences on transcription initiation from the major late promoter is dependent on a trans-acting factor encoded or induced by adenovirus.