The cytochrome b heavy chain (gp91-phox) is expressed exclusively in terminally differentiating myelomonocytic cells. The human gp91-phox gene spans approximately 30 kilobases, and is divided into 13 exons. A ubiquitous factor that is indistinguishable from the CCAAT-binding factor CP1 interacts in vitro with the distal gp91-phox promoter CCAAT box motif. CP1 binding is prevented, however, by a CCAAT displacement protein (CDP) that binds to the region surrounding the CCAAT box. CDP DNA-binding activity is found in nuclear extracts prepared from cells in which the endogenous gp91-phox gene is transcriptionally inactive, but is absent or reduced in expressing cells, consistent with CDP functioning as a repressor of gp91-phox transcription. Introduction of gp91-phox promoter/reporter constructs into nonexpressing cells yields significantly less expression than that produced by the parental reporter vector alone. The reduction in expression is relieved when the CDP/CP1-binding site is removed from the gp91-phox promoter, confirming that it is a target for repression. No derepression is observed if the CP1-binding site is selectively mutated. Derepression of expression exhibited upon deletion of the CDP/CP1-binding site suggests that, in addition to blocking the interaction of the CCAAT-binding factor with the gp91-phox promoter, CDP may also repress transcription mediated through a distinct cis-element(s). We propose that down-regulation of CDP DNA-binding activity is a necessary step in the induction of myelomonocytic-specific expression of the gp91-phox gene.