The closely linked human IL-3 and GM-CSF genes are tightly regulated and are expressed in activated T cells and mast cells. In this study, we used transgenic mice to study the developmental regulation of this locus and to identify DNA elements required for its correct activity in vivo. Because these two genes are separated by a CTCF-dependent insulator, and the GM-CSF gene is regulated primarily by its own upstream enhancer, the main objective in this study was to identify regions of the locus required for correct IL-3 gene expression. We initially found that the previously identified proximal upstream IL-3 enhancers were insufficient to account for the in vivo activity of the IL-3 gene. However, an extended analysis of DNase I-hypersensitive sites (DHSs) spanning the entire upstream IL-3 intergenic region revealed the existence of a complex cluster of both constitutive and inducible DHSs spanning the -34- to -40-kb region. The tissue specificity of these DHSs mirrored the activity of the IL-3 gene, and included a highly inducible cyclosporin A-sensitive enhancer at -37 kb that increased IL-3 promoter activity 40-fold. Significantly, inclusion of this region enabled correct in vivo regulation of IL-3 gene expression in T cells, mast cells, and myeloid progenitor cells.