The RE1-silencing transcription factor (REST)/neuron-restrictive silencer factor (NRSF) can repress transcription of a battery of neuronal differentiation genes in non-neuronal cells by binding to a specific consensus DNA sequence present in their regulatory regions. However, REST/NRSF(-/-) mice suggest that the absence of REST/NRSF-dependent repression alone is not sufficient for the expression of these neuronal differentiation genes and that the presence of other promoter/enhancer-specific activators is required. Here we describe the construction of a recombinant transcription factor, REST-VP16, by replacing repressor domains of REST/NRSF with the activation domain of a viral activator VP16. In transient transfection experiments, REST-VP16 was found to operate through RE1 binding site/neuron-restrictive enhancer element (RE1/NRSE), activate plasmid-encoded neuronal promoters in various mammalian cell types and activate cellular REST/NRSF target genes, even in the absence of factors that are otherwise required to activate such genes. Efficient expression of REST-VP16 through adenoviral vectors in NT2 cells, which resemble human committed neuronal progenitor cells, was found to cause activation of multiple neuronal genes that are characteristic markers for neuronal differentiation. Thus, REST-VP16 could be used as a unique tool to study neuronal differentiation pathways and neuronal diseases that arise due to the deregulation of this process.