The activation of germ-line promoters in the Ig heavy chain loci is regulated by cytokines as part of the regulation of B cell commitment to production of new antibody isotypes. Activation of the germ-line promoter of the epsilon heavy chain locus (Gepsilon) and production of IgE are induced by IL-4 and each is virtually undetectable in the absence of IL-4 or the homologous cytokine IL-13. Basal expression of the Gepsilon promoter is repressed by the non-histone chromosomal protein HMG-I(Y), which also contributes to promoter inducibility, and IL-4 stimulates phosphorylation of the C-terminus of HMG-I(Y) through a rapamycin-sensitive pathway. IL-4 treatment of mouse B cells also induces a Gepsilon DNA binding activity with the properties of IL-4 NAF, which is rapidly induced and requires phosphotyrosine for DNA binding activity. This protein binds to a different site from HMG-I(Y), but the IL-4 NAF/NF-IL-4 binding site also is a negative element more active in repression of basal transcription of the Gepsilon promoter. This site acts as a negative element when transferred to the thymidine kinase promoter, but does not confer inducibility. In contrast to HMG-I(Y), IL-4 NAF/NF-IL-4 activation is refractory to rapamycin but sensitive to genistein. These findings indicate that two independent signal transduction pathways diverge from the IL-4 receptor and suggest that normal expression of Gepsilon RNA or IgE is low in part because the germ-line promoter is kept in a state of repression which requires de-repression through several cooperative pathways. These pathways target conserved nucleotide sequence motifs whose precise function depends on the promoter context in which they are situated.