Mad family proteins are transcriptional repressors that antagonize the activity of the c- Myc proto-oncogene product. Mad3 is expressed specifically during the S-phase of the cell cycle in both proliferating and differentiating cells, suggesting that its biological function is probably linked to processes that occur during this period. To determine the mechanisms that regulate the cell-cycle-specific transcription of Mad3, we used reporter gene assays in stably transfected fibroblasts. We show that the activation of Mad3 at the G1-S boundary is mediated by a single E2F (E2 promoter binding factor)-binding site within the 5'-flanking region of the gene. Mutation of this element eliminated transcriptional activation at S-phase, suggesting that the positively acting E2F proteins play a role in Mad3 regulation. Using electrophoretic mobility-shift assays and chromatin immunoprecipitation, we show that E2F1 binds to the Mad3 5'-flanking region both in vitro and in vivo. We thus identify Mad3 as a novel transcriptional target of E2F1.