We show in this manuscript that expression of the mRNA for sterol regulatory element-binding protein-2 (SREBP-2) is regulated by the cellular sterol level in cultured HeLa cells. We have cloned the 5'-flanking region of the gene encoding human SREBP-2. Characterization of this region shows the minimum 50-base pair segment, which contains a 10-base pair sterol regulatory element 1 (SRE-1) identical to the one in the human LDL receptor promoter, confers sterol responsiveness when fused to the luciferase reporter gene. Enforced expression of the truncated SREBP-2 protein (amino acid residues 1-481) also shows that this upstream segment contains the information required for transcriptional activation. The luciferase assays using mutant versions of the reporter genes reveal that the sterol-dependent transcriptional regulation is mediated by two nearby motifs, the SRE-1 and the NF-Y binding site (the inverted CCAAT box, ATTGGC); the latter is reported to play a critical role in sterol-dependent regulation of 3-hydroxy-3-methylglutaryl-coenzyme A synthase and farnesyl diphosphate synthase genes (Jackson, S. M., Ericsson, J., Osborne, T. F., and Edwards, P. A. (1995) J. Biol. Chem. 270, 21445-21448). Gel mobility shift assays demonstrate that the transcription factor NF-Y truly binds to the ATTGGC sequence. These findings suggest that the activity of SREBP-2 is controlled not only post-translationally by proteolytic activation of the precursor protein but also transcriptionally by itself together with NF-Y.