Activation of hGH-1 expression is mediated by the pituitary-specific transcription factor GHF-I/Pit-I which binds the 5'-flanking DNA at two sites: I (-96/-70) and II (-134/-106). Although the factor(s) which direct the placental-specific expression of hCS-1 are not known, hCS-1 sequences are transcriptionally active in pituitary cells. In the present study we examined the effects of sequence differences between hGH-1 and hCS-1 5'-flanking DNAs in determining their basal and thyroid hormone-regulated promoter activities. We showed that Sp1 is a major determinant of both hGH-1 and hCS-1 promoter activities and that in hGH-1, binding and activation by Sp1 are modulated by interference from GHF-I/Pit-1 binding at the adjacent site II sequence. A single base which differed in site II of hCS-1 greatly reduced GHF-1/Pit-1 binding and thus facilitated binding and activation by Sp1. Further differences in promoter activity of hGH-1 and hCS-1 sequences were accounted for by a thyroid hormone-responsive element between -62/-48 in the hCS-1 gene. However, induction by T3 was independent of either Sp1 or GH-1/Pit-1 binding in the site II region. These data demonstrate that a small number of base changes between hGH and hCS promoter sequences subserve a number of mechanisms which may differentially modulate the expression of hGH and hCS genes.