Binding of agonists to nuclear receptors results in a conformational change in receptor structure that promotes interaction between activated receptors and coactivators. Receptor-coactivator interactions are mediated by the agonist-dependent formation of a hydrophobic pocket on the part of receptors, and short leucine-rich sequences termed LxxLL motifs or nuclear receptor boxes present in coactivators. RXR-PPARgamma (retinoid X receptor-peroxisome proliferator-activated receptor-gamma) heterodimers play important roles in adipocyte and macrophage differentiation and have been implicated as therapeutic targets in diabetes, atherosclerosis, and cancer. Analysis of interactions between RXR-PPARgamma heterodimers and coactivator nuclear receptor boxes suggests that RXR and PPARgamma can distinguish among coactivators by recognizing distinct structural features of nuclear receptor boxes. The results also indicate that coactivator choice by RXR is mediated by three nonconserved amino acids of the nuclear receptor box. The ability of an optimized seven-amino acid nuclear receptor box to specifically interact with RXR and function as a selective inhibitor suggests the coactivator-binding pocket may serve as a new target for drug discovery.