The murine dihydrofolate reductase gene is regulated by a bidirectional promoter that lacks a TATA box. To identify the DNA sequences required for dihydrofolate reductase transcription, the activities of various templates were determined by in vitro transcription analysis. Our data indicate that sequences both upstream and downstream of the transcription initiation site modulate the activity of the dihydrofolate reductase promoter. We have focused on two regions downstream of the transcription initiation site that are important in determining the overall efficiency of the promoter. Region 1, which included exon 1 and part of intron 1, could stimulate transcription when placed in either orientation in the normal downstream position and when inserted upstream of the transcription start site. This region could also stimulate transcription in trans when the enhancer was physically separate from the promoter. Deletion of region 2, spanning 46 nucleotides of the 5' untranslated region, reduced transcriptional activity by fivefold. DNase I footprinting reactions identified protein-binding sites in both downstream stimulatory regions. Protein bound to two sites in region 1, both of which contain an inverted CCAAT box. The protein-binding site in the 5' untranslated region has extensive homology to binding sites in promoters that both lack (simian virus 40 late) and contain (adenovirus type 2 major late promoter and c-myc) TATA boxes.