The release of interferon-gamma (IFNgamma) has been demonstrated from the infiltrating T lymphocytes of the thyroid gland from patients with autoimmune thyroid disease (AITD). We have shown previously that IFNgamma inhibited thyroglobulin (Tg) gene transcription, and that its action was mediated by an increase in intracellular calcium and inositol phosphates. In the present study, we tried to determine the specific site of action of IFNgamma on the Tg gene. A 565 bp fragment (position -530 to +34) spanning the transcriptional start site of the human Tg promoter was ligated to the luciferase plasmid and transiently transfected into human thyrocytes. Stimulation with TSH (10 mIU/l) and IFNgamma (500 IU/l) resulted in a twofold increase and a 60% reduction in the luciferase activity respectively, similar to the effect observed with the endogenous Tg gene. Deletion studies revealed that the region with the strongest suppression by IFNgamma lay between 5' -388 to -258. Mobility gel shift experiments and DNA footprinting experiments demonstrated that the action of IFNgamma was mediated through a trans-acting protein which complexed to position -282 to -262 TTGAGCCTGTTCCCTC CAAA. Position -272 to -261 TTCCCTCCAA corresponded to the gamma-interferon activation site (GAS) consensus sequence TTNC(C)T NNNA. The turnover time of the nuclear protein lasted for only 4 h although the suppressive effect of IFNgamma on Tg gene transcription lasted for 48 h. The effect of IFNgamma was lost when the thyrocytes were co-treated with genistein, a specific tyrosine kinase inhibitor. The presence of the GAS in the promoter sequence of the Tg gene confirms the specific action of IFNgamma in thyroid hormone metabolism. In conclusion, apart from its regulatory role in T cell development and perpetuation of the immune response in AITD, IFNgamma may also play a role in altering cellular function of the thyrocytes by its action on the Tg gene promoter.