A repeated element, the inositol-sensitive upstream activation sequence (UASINO), having the consensus sequence, 5'-CATGTGAAAT-3', is present in the promoters of genes encoding enzymes of phospholipid biosynthesis that are regulated in response to the phospholipid precursors, inositol and choline. None of the naturally occurring variants of the UASINO element exactly recapitulates the consensus (for review, see Carman, G. M., and Henry, S. A. (1989) Annu. Rev. Biochem. 58, 635-669 and Paltauf, F., Kolwhein, S., and Henry, S. A. (1992) in Molecular Biology of the Yeast Saccharomyces cerevisiae (Broach, J., Jones, E., and Pringle, J., eds) Vol. 2, Cold Spring Harbor Laboratory, Cold Spring Harbor, NY). The first six bases of the UASINO element are homologous with canonical binding motif for proteins of the basic helix-loop-helix (bHLH) family. Two bHLH regulatory proteins, Ino2p and Ino4p from yeast, were previously shown to bind to promoter fragments containing this element. In the present study, an extensive analysis of UASINO function has been conducted. We report that any base substitution within the putative bHLH binding site resulted either in a dramatic reduction or in a complete obliteration of UASINO function as tested in an expression assay in vivo. Base substitutions in the 5' region that flanks the 10-base pair repeat, as well as sequences within the repeat itself at its 3' end outside the bHLH core, were also assessed. The two bases immediately flanking the 5' end of the element proved to be very important to its function as a UAS element as did the two bases immediately 3' of the bHLH core motif. Substitutions of the final two bases of the original ten base pair consensus (i.e. 5'-CATGTGAAAT-3') had less dramatic effects. We also tested a subset of the altered elements for their ability to serve as competitors in an assay of Ino2p x Ino4p binding. The strength of any given sequence as a UASINO element, as assayed in vivo, was strongly correlated with its strength as a competitor for Ino2p x Ino4p binding. We also tested a subset of the modified UASINO elements for their effects on expression in vivo in a strain carrying an opi1 mutation. The opi1 mutation renders the coregulated enzymes of phospholipid synthesis constitutive in the presence of phospholipid precursors. All elements that retained some residual UASINO activity when tested in the wild-type strain were constitutively expressed at a level comparable with the wild-type derepressed level when tested in the opi1 mutant.(ABSTRACT TRUNCATED AT 400 WORDS)