The aromatase (cytochrome P-450AROM) gene contains multiple untranslated exons I that are differentially transcribed in a tissue-specific manner. DNA sequences within the initial -301 upstream of placenta-specific exon I (exon Ia) are sufficient for placenta-specific expression of aromatase. In gel mobility shift assay, three separate domains in this region form specific binding complexes with proteins extracted from choriocarcinoma JEG-3 nuclei. A fragment containing these domains activates transcription driven by a heterologous promoter in a cell type-specific manner. Two of the binding domains that form major complexes in gel shift assay compete with each other and with a DNA fragment containing the trophoblast-specific element (TSE), which is derived from the enhancer region of the human chorionic gonadotropin alpha-subunit gene and is believed to confer placenta-specific expression of the gene. The core sequence RNCCTNNRG is sufficient for recognition of the TSE-binding protein, which is detected only in nuclear extracts prepared from placenta and choriocarcinoma. A mutation introduced in the distal TSE core in aromatase promoter resulted in marked reduction of transcriptional activity, although TSE region by itself did not show enhancer activity as that in human chorionic gonadotropin alpha-subunit gene.