B-ATF is a nuclear basic leucine zipper protein that belongs to the AP-1/ATF superfamily of transcription factors. Northern blot analysis reveals that the human B-ATF gene is expressed most highly in hematopoietic tissues. Interaction studies in vitro and in vivo show that the leucine zipper of B-ATF mediates dimerization with members of the Jun family of proteins. Chimeric proteins consisting of portions of B-ATF and the DNA binding domain of the yeast activator GAL4 do not stimulate reporter gene expression in mammalian cells, indicating that B-ATF does not contain a conventional transcription activation domain. Jun/B-ATF dimers display similar DNA binding profiles as Jun/Fos dimers, with a bias toward binding TRE (12-O-tetradecanolyphorbol-13-acetate-response element) over CRE (cyclic AMP-response element) DNA sites. B-ATF inhibits transcriptional activation of a reporter gene containing TRE sites in a dose-dependent manner, presumably by competing with Fos for Jun and forming transcriptionally inert Jun/B-ATF heterodimers. Stable expression of B-ATF in C3H10T1/2 cells does not reduce cell viability, but does result in a reduced cellular growth rate when compared to controls. This effect is dominant in the presence of the growth promoting effects of the H-Ras or the v-Fos oncoproteins, since expression of B-ATF restricts the efficiency of focus formation by these transforming agents. These findings demonstrate that B-ATF is a tissue-specific transcription factor with the potential to function as a dominant-negative to AP-1.