HES-5 is a mammalian basic helix-loop-helix factor that has a distant sequence homology to the product of the Drosophila pair-rule gene hairy. HES-5 mRNA is present exclusively in the developing nervous system, but its level decreases as neural differentiation proceeds. In this study, to characterize the molecular mechanism of the neural-specific expression of HES-5 we isolated the mouse HES-5 gene. This gene consists of three exons, and Southern blot analysis shows that it is a single copy gene. The transcription initiation site, determined by primer extension and reverse transcriptase-mediated polymerase chain reaction, is located 26 nucleotides downstream of a TATAbox. Transient transfection analysis shows that the upstream region of the HES-5 gene can direct efficient expression in neural precursor cells and moderate expression in undifferentiated NCB20 neuroblastoma-brain hybrid cells but not in glioma or fibroblast cells. The moderate level of expression in NCB20 cells decreases when differentiation into neuron-like cells is induced. Further promoter analysis shows that this undifferentiated neural-specific expression is mediated by the multiple GC stretches present in the HES-5 promoter. Gel mobility shift analysis suggests the presence of a neural precursor cell-specific protein that binds to the GC stretches. These results raise the possibility that HES-5 expression in the developing nervous system is regulated by the GC stretch-binding protein.