The gene for rat bone gla protein (BGP) was isolated and 1250 basepairs (bp), including 1100 bp of 5' flanking DNA, were placed up-stream of the human GH reporter gene. After transient transfection into the osteoblast-like rat osteosarcoma cell line ROS 17/2.8, the BGP promoter demonstrated a low level of basal activity that was increased approximately 10-fold by the addition of 10(-8) M 1,25-dihydroxyvitamin D3 [1,25-(OH)2D3]. A single 250-bp fragment (-523 to -274) was sufficient to confer hormone inducibility upon both heterologous and homologous promoters. Deletion studies, complemented by evaluation with synthetic oligomers, enabled localization of the 1,25-(OH)2D3 response element to within 19 bp (-456 to -438), containing an element with an imperfect direct repeat [GGTGA(N4)GGACA] and homology to other steroid-responsive elements. Gel retardation assays demonstrated that partially purified chick intestinal 1,25-(OH)2D3 receptor bound specifically and with high affinity to a DNA fragment containing the putative 1,25-(OH)2D3 response element, and this binding was perturbed by monoclonal antibodies to the 1,25-(OH)2D3 receptor. Surprisingly, the 250-bp fragment, when linked in an antisense orientation with respect to the BGP promoter, blocked basal and hormone-dependent gene expression. However, a 246-bp fragment 5' to the 250-bp element (-1100 to -855) restored 20-fold inducibility when linked to the first fragment in the same orientation, suggesting cooperativity between at least two elements to achieve the hormonal regulation observed in this gene.