The aryl hydrocarbon receptor nuclear translocator (ARNT) protein is involved in many signaling pathways. Rainbow trout express isoforms of ARNT protein that are divergent in their C-terminal domains due to alternative RNA splicing. Rainbow trout ARNT(b) (rtARNT(b)) contains a C-terminal domain rich in glutamine and asparagine (QN), whereas the C-terminal domain of rtARNT(a) is rich in proline, serine, and threonine (PST). rtARNT(b) functions positively in AH receptor-mediated signaling, whereas rtARNT(a) functions negatively. Studies were performed to understand how changes in the C-terminal domains of the two rtARNT isoforms affect function. Deletion of the QN-rich C-terminal domain of rtARNT(b) did not affect function in aryl hydrocarbon receptor (AHR)-mediated signaling, whereas deletion of the PST-rich domain of rtARNT(a) restored function. Expression of the PST-rich domain on truncated rtARNT(b) or mouse ARNT (mARNT) reduced function of this protein by 50-80%. Gel shift assays revealed that the PST-rich domain affected AHR-mediated signaling by inhibiting DNA binding of the AHR*ARNT heterodimer. Gal4 transactivation assays revealed a potent transactivation domain in the QN-rich domain of rtARNT(b). In contrast, Gal4 proteins containing the PST-rich domain of rtARNT(a) did not transactivate because the proteins did not bind to DNA. Secondary structure analysis of the PST-rich domain revealed hydrophilic and hydrophobic regions. Truncation of the hydrophobic domain that spanned the final 20-40 amino acids of the rtARNT(a) restored function to the protein, suggesting that repressor function was related to protein misfolding or masking of the basic DNA binding domain. Functional diversity within the C-terminal domain is consistent with other negatively acting transcription factors and illustrates a common biological theme.