The major histocompatibility complex class I antigens play an indispensable role in cell-cell interactions. Perturbation of their expression has been shown to have deleterious physiological consequences, including the escape of transformed cells from immune detection. In an attempt to understand how class I genes are regulated, we dissected the Ld gene to identify potential control regions. By using a test vector containing the simian virus 40 early promoter placed upstream of the bacterial chloramphenicol acetyltransferase (cat) gene, we demonstrated the presence of a transcriptional enhancer within the 5'-flanking region. The sequence is functional in both orientations and has been mapped within 350 base pairs upstream of the Ld transcriptional start site. Although human adenovirus 12 can suppress endogenous class I genes, it cannot down-regulate the activity of the transiently transfected cat gene which has been placed under the control of the Ld enhancer and promoter. Our results suggested that if the human adenovirus 12-induced function regulates the expression of class I genes by a trans mechanism, then its target site must not be within 1.9 kilobases of the 5'-flanking region. Treatment of cells with interferon increases the accumulation of class I transcripts. Expression of the cat gene under the control of the Ld enhancer and promoter also can be up-regulated by interferon. Our study shows that the target sequence required for this enhancement resides, at least in part, within the same 350-base pair segment which contains the transcriptional enhancer.