FasL expressed in tumor cells plays an important role in the escape from immune surveillance by inducing apoptosis in T-cells bearing Fas. Since the Fas/FasL signaling pathway requires transcriptional induction of the FasL gene, elucidation of the precise mechanisms underlying regulation of FasL gene expression may provide useful molecular insights on tumor progression. We and others (Shin, E. C., Shin, J. S., Park, J. H., Kim, H., and Kim, S. J. (1999) Int. J. Cancer 82, 587-591; Lee, M. O., Kang, H. J., Cho, H., Shin, E. C., Park, J. H., and Kim, S. J. (2001) Biochem. Biophys. Res. Commun. 288, 1162-1168) have previously reported that hepatitis B virus X protein (HBx) plays a role in the induction of FasL expression in hepatitis B virus-associated hepatoma. In the present study, we analyzed the potential cis- and trans-acting factors that regulate FasL promoter. We found that HBx induced activity of the reporter containing FasL promoter through binding site for Egr but not through NFAT or SP-1, which are known as strong activators of the FasL promoter in T-cells. Transient expression of antisense Egr-2 and antisense Egr-3 abolished expression of FasL, which further confirmed the role of Egr in the HBx-mediated FasL expression. Also we observed that HBx increased the transcriptional activity of Egr-2 and Egr-3 by enhancing expression as well as the transactivation function of these proteins. HBx interacted with Egr-2 and Egr-3 in vivo and enhanced binding of Egr to the co-activator, cAMP-response element-binding protein-binding protein, which may explain the molecular mechanism by which HBx induced the transactivation function of Egr. Finally, we found that the carboxyl terminus of HBx was necessary and sufficient for FasL induction as well as activation of Egr. Taken together, our results show a novel mechanism by which HBx induces FasL gene expression that is mediated by enhancing transcriptional activity of Egr-2 and Egr-3.