The aryl hydrocarbon receptor (AHR) is a ligand-activated transcription factor, until now described only in vertebrates, that mediates many of the carcinogenic and teratogenic effects of certain environmental pollutants. Here, we describe orthologs of AHR and its dimerization partner AHR nuclear translocator (ARNT) in the nematode Caenorhabditis elegans, encoded by the genes ahr-1 and aha-1, respectively. The corresponding proteins, AHR-1 and AHA-1, share biochemical properties with their mammalian cognates. Specifically, AHR-1 forms a tight association with HSP90, and AHR-1 and AHA-1 interact to bind DNA fragments containing the mammalian xenobiotic response element with sequence specificity. Yeast expression studies indicate that C. elegans AHR-1, like vertebrate AHR, requires some form of post-translational activation. Moreover, this requirement depends on the presence of the domains predicted to mediate binding of HSP90 and ligand. Preliminary experiments suggest that if AHR-1 is ligand-activated, its spectrum of ligands is different from that of the mammalian receptor: C. elegans AHR-1 is not photoaffinity labeled by a dioxin analog, and it is not activated by beta-naphthoflavone in the yeast system. The discovery of these genes in a simple, genetically tractable invertebrate should allow elucidation of AHR-1 function and identification of its endogenous regulators.