The expression of the major matrix-degrading metalloproteinase, stromelysin (SL), is modulated by a variety of cytokines and growth factors. Interferon-gamma (IFN-gamma) is a potent modulator of SL expression, either inhibiting or activating expression in a cell-specific manner. We have investigated the mechanisms involved in the regulation of SL gene expression in cultured human fibroblasts by IFN-gamma. Reverse transcription-polymerase chain reaction (RT-PCR) assays confirmed the previously reported profound inhibitory response of SL mRNA expression to IFN-gamma [Amaldi et al., 1989]. For evaluation in transient gene expression assays, 1.2-kilobase (kb) pairs (-1214 to +14 relative to the transcription start site), and shorter, deletion mutant fragments of the SL promoter were cloned into appropriate chloramphenicol acetyltransferase transferase (CAT) expression vectors. The SL promoter along this region contains an active polyomavirus enhancer A-binding protein-3 (PEA-3) site at -216 and an activator protein-1 (AP-1) site at -70. Treatment of transfected neonatal foreskin fibroblasts with 300-500 U/ml IFN-gamma resulted in down-regulation of both basal and IL-1beta-induced CAT gene expression. IFN-gamma also decreased CAT expression when placed under the control of a synthetic multimeric AP-1 site construct. Gel-shift assay data indicate a decrease in specific binding to AP-1 oligonucleotide of nuclear extract from IFN-gamma and PMA/IFN-gamma-treated cells. The suppression of SL expression by IFN-gamma, in human fibroblasts therefore is mediated through the AP-1 element.