The pancreatic beta-cell-specific expression of the insulin gene is mediated, at least in part, by the interaction of unique trans-acting beta-cell factors with a cis-acting DNA element found within the insulin enhancer (5'-GC CATCTG-3'; referred to as the insulin control element [ICE]) present in the rat insulin II gene between positions -100 and -91. This sequence element contains the consensus binding site for a group of DNA-binding transcription factors called basic helix-loop-helix proteins (B-HLH). As a consequence of the similarity of the ICE with the DNA sequence motif associated with the cis-acting elements of the B-HLH class of binding proteins (CANNTG), the ability of this class of proteins to regulate cell-type-specific expression of the insulin gene was addressed. Cotransfection experiments indicated that overexpression of Id, a negative regulator of B-HLH protein function, inhibits ICE-mediated activity. Antibody to the E12/E47 B-HLH proteins attenuated the formation, in vitro, of a previously described (J. Whelan, S. R. Cordle, E. Henderson, P. A. Weil, and R. Stein, Mol. Cell. Biol. 10:1564-1572, 1990) beta-cell-specific activator factor(s)-ICE DNA complex. Both of these B-HLH proteins (E12 and E47) bound efficiently and specifically to the ICE sequences. The role of B-HLH proteins in mediating pancreatic beta-cell-specific transcription of the insulin gene is discussed.