Latent and activated forms of Stat1 and Stat6 have been expressed and purified, enabling biochemical experiments relating to their functional activities. Stat1 bound to a phosphotyrosine peptide derived from the IFN gamma receptor with a KD of 50 nM, whereas Stat6 bound to an IL-4 receptor peptide with a KD of 300 nM. Stat-receptor peptide interactions were specific and dependent upon tyrosine phosphorylation. Activated forms of Stat1 and Stat6 were used to select their optimal DNA binding sites. Stat1 selected a recognition site having dyad half-sites separated by 3 bp. Stat6 selected a recognition site composed of the same dyad half-sites, yet separated by 4 bp. Chimeric Stat1-Stat6 recombinants were expressed, purified, and assayed for receptor coupling and DNA binding specificity. Such studies led to the identification of polypeptide domains that specify these activities. These observations provide a framework for understanding how different cytokines elicit distinctive patterns of gene expression.