Steroid hormone receptors activate specific gene transcription by binding as hormone-receptor complexes to short DNA enhancer-like elements termed hormone response elements. The DNA-binding domain (termed region C) is a highly conserved 66-amino acid region that contains two subregions (CI and CII) analogous to the "zinc fingers" of transcription factor IIIA. Using chimeric estrogen receptors, we show that this region, and in particular the NH2-terminal zinc finger, defines the target gene specificity of the receptor. We suggest that receptor recognition of the hormone response element is analogous to that of the helix-turn-helix DNA-binding motif in that the receptor binds to DNA as a dimer with the first zinc finger lying in the major groove recognizing one-half of the palindromic hormone response element and protein-DNA interaction is stabilized through nonspecific DNA binding and dimer interactions contributed by the second zinc finger.