Distal-less 3 (DLX3), a homeodomain transcription factor required for placental development in the mouse, modestly transactivates hCG-alpha subunit gene (hCGA) expression in human choriocarcinoma cells. Because hCG and interferon-tau (IFNT) are expressed in trophectoderm of primates and ruminants, respectively, we have tested the hypothesis that DLX3 regulates the genes for IFNT (IFNT). A bovine IFNT1 promoter (-457 to +66), linked to a luciferase (luc) reporter, was transactivated approximately 20-fold by overexpressing DLX3 in human JAr cells. Elimination of a potential DLX3-binding site (-54 GATAATGAG -46) by either truncation or mutagenesis abolished this effect. A sequence (-59 to -44) encompassing this site bound DLX3 specifically. Coexpression of DLX3 and ETS2, which is known to be a key regulator of IFNT expression, increased reporter activity by more than 250-fold, whereas deletion of the established ETS2 site (-79 to -70) eliminated the ability of DLX3 to transactivate the gene. Conversely, mutation of the DLX3 site significantly reduced the transactivational effects of ETS2. Both DLX3 and ETS2 are coexpressed in JAr cells and in an IFNT-producing, bovine trophoblast cell line, CT-1. The two can be immunoprecipitated together as a complex from CT-1 cells, and RNAi-mediated, partial knockdown of DLX3 expression reduced the production of IFNT by approximately 50+. Together, these results suggest that DLX3 has a central role in controlling IFNT gene expression by associating with ETS2 on the IFNT promoter.