Peroxisome proliferators are a diverse group of chemicals, including several hypolipidaemic drugs, that activate a nuclear hormone receptor termed the peroxisome proliferator activated receptor (PPAR). The peroxisomal enzyme acyl CoA oxidase (ACO) is the most widely used marker of peroxisome proliferator action. We have examined the 5' flanking region of the rat ACO gene for sequences that mediate the transcriptional effect of peroxisome proliferators and have identified an element located 570 bp upstream of the ACO gene that confers responsiveness to the hypolipidaemic peroxisome proliferator Wy-14,643. This peroxisome proliferator response element (PPRE) contains a direct repeat of the sequence motifs TGACCT and TGTCCT and binds PPAR. These data therefore indicate an important role of PPAR in mediating the action of peroxisome proliferators including the induction of ACO.