The ets transcription factor PU.1 is an important regulator of the immunoglobulin heavy chain gene intronic enhancer, or mu enhancer. However, PU.1 is only one component of the large multiprotein complex required for B cell-specific enhancer activation. The transcriptional coactivator HMG-I(Y), a protein demonstrated to physically interact with PU.1, increases PU.1 affinity for the mu enhancer muB element, indicating that HMG-I(Y) may play a role in the transcriptionally active mu enhanceosome. Increased PU.1 affinity is not mediated by HMG-I(Y)-induced changes in DNA structure. Investigation of alternative mechanisms to explain the HMG-I(Y)-mediated increase in PU.1/mu enhancer binding demonstrated, by trypsin and chymotrypsin mapping, that interaction between PU.1 and HMG-I(Y) in solution induces a structural change in PU.1. In the presence of HMG-I(Y) and wild-type mu enhancer DNA, PU.1 becomes more chymotrypsin resistant, suggesting an additional change in PU.1 structure upon HMG-I(Y)-induced PU.1/DNA binding. From these results, we suggest that increased DNA affinity under limiting PU.1 concentrations is mediated by an HMG-I(Y)-induced structural change in PU.1. In functional assays, HMG-I(Y) further augments transcriptional synergy between PU.1 and another member of the ets family, Ets-1, indicating that HMG-I(Y) is a functional component of the active enhancer complex. These studies suggest a new mechanism for HMG-I(Y)-mediated coactivation; HMG-I(Y) forms protein-protein interactions with a transcription factor, which alters the three-dimensional structure of the factor, resulting in enhanced DNA binding and transcriptional activation. This mechanism may be important for transcriptional activation under conditions of limiting transcription factor concentration, such as at the low levels of PU.1 expressed in B cells.