Vertebrate hairy genes are expressed in patterns thought to be readouts of a "segmentation clock" in the presomitic mesoderm. Here we use transgenic Xenopus embryos to show that two types of regulatory elements are required to reconstitute the segmental pattern of Xenopus hairy2. The first is a promoter element containing two binding sites for Xenopus Su(H), a transcriptional activator of Notch target genes. The second is a short sequence in the hairy2 3' untranslated region (UTR), which most likely functions posttranscriptionally to modulate hairy2 RNA levels. 3' UTRs of other hairy-related, segmentally expressed genes can substitute for that of hairy2. Our results demonstrate a novel mechanism regulating the segmental patterns of Notch target genes and suggest that vertebrate segmentation requires the intersection of two regulatory pathways.