Nuclear factors enhance binding of T3 receptors (TR) to DNA, suggesting that T3 action may require a multicomponent complex bound to thyroid hormone response elements (TREs). We refer to the 65,000 Da nuclear protein in GH3 cells that enhances TR binding to DNA as the TR-auxiliary protein (TRAP) and have characterized its interaction with TR. Using a TRE-DNA affinity matrix we show that TRAP is able to bind to DNA, even in the absence of functional TR. We then used carboxyl-terminal truncations of rat TR alpha-1 and human TR beta in the avidin-biotin complex DNA-binding assay to identify regions that are important for interaction with TRAP. Removal of 34 residues of hTR beta abolishes T3-binding activity, but the ability to bind TRAP is retained. Further truncations and point mutations suggest that TRAP interacts with the ligand-binding domain of TR and with an independent region which overlaps a conserved sequence adjacent to the second Zn2+ finger (amino acids 120-149 in rTR alpha-1). A fragment of rTR alpha-1 (alpha C291) which encompasses these two regions inhibits the ability of TRAP to enhance TR binding to DNA. This is due to binding of alpha C291 to TR, demonstrating the ability of TR to form homodimers. The inability of TRAP to interact with TR dimers and the similarity of the locations of the estradiol receptor dimerization domains with the TRAP interaction regions lead us to conclude that TRAP stabilizes TR binding to DNA by formation of TRAP-TR heterodimers with both proteins bound to the DNA. TR bound to the estrogen response element is unable to respond to TRAP and unable to stimulate transcription, possibly due to the absence of TRAP in the TR-estrogen response element complex. In addition, TRAP may interact with a certain subset of the nuclear receptor superfamily, since human retinoic acid receptor-beta and vitamin D receptor show increased binding to TREs in the presence of nuclear extract, but c-erbA alpha-2, a variant TR, does not respond to TRAP.