The herpes simplex virus transactivator VP16 directs the assembly of a multicomponent protein-DNA complex with cellular components Oct-1 and VCAF-1, contributing a potent carboxyl-terminal acidic activation domain that is essential for activation of gene expression in mammalian cells. We show here that VP16, devoid of this acidic activation domain, functions as a strong transcriptional activator in the yeast Saccharomyces cerevisiae when appended onto a heterologous GAL4 DNA binding domain, as determined by measuring activation of a resident GAL1:lacZ reporter gene. Deletion analysis indicated that sequences contained within the amino-terminal 369 amino acids of VP16 were necessary for transactivation by truncated VP16. Activation by truncated VP16 in yeast was comparable to that observed with a hybrid protein consisting of the GAL4 DNA binding domain linked to the VP16 acidic activation domain. Similar GAL4-VP16 hybrid proteins were only marginally active in mammalian cells. Sequence requirements for transactivation by truncated VP16 can be demarcated from domains of VP16 that are required for interaction with VCAF-1 and for protein-DNA complex formation with Oct-1. Our findings indicate that VP16 contains additional sequences upstream of the acidic activation domain that may play a direct role in transactivation.