IFN-gamma is a potent inducer of Ig kappa light chain gene transcription in 70Z/3 pre-B cells, but the mechanism of this induction has not been elucidated. The kappa intron enhancer contains a sequence closely resembling the IFN-stimulated response element (ISRE). We have determined that the kappa intron enhancer is IFN-gamma inducible in 70Z/3 cells and that the ISRE is required for this induction. The kappa intron ISRE specifically bound IFN response factor-1 (IRF-1) and the constitutively expressed IRF-2. This ISRE is a multifunctional motif that also binds the LPS-inducible factor kappaBF-A and is located within the kappaBS region, which confers B cell specific activity to this enhancer. However, since the expression of IRF-1 is not restricted to B cells, it must not be sufficient for the induction of kappa transcription. Furthermore, in the pre-B cell line 38B9, which is representative of an earlier stage in pre-B cell development than the 70Z/3 cell line, the kappa intron enhancer was not induced by IFN-gamma despite the activation of IRF-1. These findings suggest that IFN-gamma activation of kappa gene transcription during B cell maturation may be developmentally controlled by elements that restrict the activity of the ISRE within the context of the intron enhancer.