The 7-dehydrocholesterol reductase (Dhcr7) is the terminal enzyme in the pathway of cholesterol biosynthesis. We have previously reported that sterol depletion in vivo caused a significant induction of both liver mRNA and enzyme activity of Dhcr7 (Bae, S.-H., Lee, J. N., Fitzky, B. U., Seong, J., and Paik, Y.-K. (1999) J. Biol. Chem. 274, 14624-14631). In this paper, we also observed liver cell-specific sterol-mediated Dhcr7 gene induction in vitro by sterol depletion in rat hepatoma cells, suggesting the presence of sterol-mediated regulatory elements in the Dhcr7 gene. To understand the mechanisms responsible for regulating Dhcr7 expression, we have isolated the 5'-flanking region of the gene encoding rat Dhcr7 and have characterized the potential regulatory elements of the gene that are responsible for sterol-mediated regulation. The Dhcr7 promoter contains binding sites for Sp1 (at -177, -172, -125, and -20), NF-Y (at -88 and -51), and SREBP-1 or ADD1 (at -33). Deletion analysis of the Dhcr7 gene promoter (-1053/+31), employing a nested series of Dhcr7-luciferase constructs, demonstrated that the -179 upstream region of the gene is necessary and sufficient for optimal efficient sterol-regulated transcription. DNase I footprinting and electrophoretic mobility shift assay showed that the SRE1/E box (-33/-22) involved in sterol response of many sterol-related enzyme genes was protected specifically by the overexpressed recombinant ADD1. Mutational analysis for the functional relationship between the identified cis-elements in this region indicate that one of the binding sites for Sp1 (GC box at -125) and NF-Y (CCAAT box at -88) plays a cooperative role in the sterol-mediated activation, in which the latter site also acts as a co-regulator for SREBP-activated Dhcr7 promoter activity. We believe that Dhcr7 is the first enzyme characterized with a sterol-regulatory function in the post-lanosterol pathway. This may be important for understanding the coordinated control of cholesterol biosynthesis as well as the molecular mechanism of Smith-Lemli-Opitz syndrome-related protein in mammals.