The gene encoding cholesterol 7α-hydroxylase (CYP7A), the rate-limiting enzyme in bile acid synthesis, is transcriptionally regulated by bile acids and hormones. Previously, we have identified two bile acid response elements (BARE) in the promoter of the CYP7A gene. The BARE II is located in nt - 149/-118 region and contains three hormone response element (HRE)-like sequences that form two overlapping nuclear receptor binding sites. One is a direct repeat separated by one nucleotide DR1 (-146-TGGACTtAGTTCA-134) and the other is a direct repeat separated by five nucleotides DR5 (-139- AGTTCAaggccGGGTAA-123). Mutagenesis of these HRE sequences resulted in lower transcriptional activity of the CYP7A promoter/reporter genes in transient transfection assay in HepG2 cells. The orphan nuclear receptor, hepatocyte nuclear factor 4 (HNF-4)1, binds to the DR1 sequence as assessed by electrophoretic mobility shift assay, and activates the CYP7A promoter/reporter activity by about 9-fold. Cotransfection of HNF-4 plasmid with another orphan nuclear receptor, chicken ovalbumin upstream promoter- transcription factor II (COUP-TFII), synergistically activated the CYP7A transcription by 80-fold. The DR5 binds the RXR/RAR heterodimer. A hepatocyte nuclear factor-3 (HNF-3) binding site (-175-TGTTTGTTCT-166) was identified. HNF-3 was required for both basal transcriptional activity and stimulation of the rat CYP7A promoter activity by retinoic acid. Combinatorial interactions and binding of these transcription factors to BAREs may modulate the promoter activity and also mediate bile acid repression of CYP7A gene transcription.