The transcription factor CCAAT/enhancer binding protein beta (C/EBPbeta) contains multiple acetylation sites, including lysine (K) 39. Mutation of C/EBPbeta at K39, an acetylation site in the transcriptional activation domain, impairs transcription of C/EBPbeta target genes in a dominant-negative fashion. Further, K39 of C/EBPbeta can be deacetylated by HDAC1, and HDAC1 may decrease C/EBPbeta-mediated transcription, suggesting that acetylation of C/EBPbeta at K39 is dynamically regulated in mediating gene transcription. Acetylation of endogenous C/EBPbeta at K39 is detected in adipose tissue, and also occurs in 3T3-L1 cells undergoing adipocyte conversion. In addition, mutation of K39 in C/EBPbeta impairs activation of its target genes encoding C/EBPalpha and PPARgamma, essential mediators of adipogenesis, as well as adipocyte genes for leptin and Glut4. These findings suggest that acetylation of C/EBPbeta at K39 is an important and dynamic regulatory event that contributes to its ability to transactivate target genes, including those associated with adipogenesis and adipocyte function.