We have identified an enhancer responsible for induction by 3-methylcholanthrene in the upstream region of the CYP1A2 gene. The enhancer does not contain the invariant core sequence of XREs that are binding sites for the Ah receptor (AhR) and Arnt heterodimer. The enhancer did not show any inducible expression in Hepa-1-derived cell lines, C4 and C12, deficient of Arnt and AhR, respectively. On the other hand, bacterially expressed AhR-Arnt heterodimer could not bind to the enhancer. Mutational analysis of the enhancer revealed that a repeated sequence separated by six nucleotides is important for expression. A factor binding specifically to the enhancer was found by using gel shift assays. Bacterially expressed AhR-Arnt heterodimer interacted with the factor. A dominant negative mutant of the AhR to XRE activated the enhancer. Collectively, these results demonstrate that a novel induction mechanism is present in which the AhR-Arnt heterodimer functions as a coactivator. (C) 2004 Elsevier Inc. All rights reserved.