A family of basic-helix-loop-helix (bHLH) nuclear factors play important roles in controlling cell growth and differentiation as critical regulatory components in transcription. Here we describe molecular characterization of mesoderm-specific bHLH protein, POD-1/Capsulin. Transactivation property of POD-1/Capsulin was analyzed by the Gal4 fusion system in six mammalian cell lines. The results indicated that an activation property was shown in HT1080 and HeLa cells, but a repression activity in HepG2 cells. Mapping analysis for the transactivation and repression activities revealed that the C-terminal domain of POD-1/Capsulin is essential for the transactivation and both the N-terminal and C-terminal domains are contributed to the repression activities. Furthermore, in order to identify possible interactants of the POD-1/Capsulin, we performed yeast two-hybrid screen in a human kidney cDNA library, and identified a class A bHLH protein, ITF-2 as potential heterodimeric partner of the bHLH protein.