Three upstream CBAR cis-acting promoter elements, containing the inner core CC(A/T)6GG of the serum response element (SRE), are required for myogenic cell type-restricted expression of the avian skeletal alpha-actin gene (K.L. Chow and R.J. Schwartz, Mol. Cell. Biol. 10:528-538, 1990). These actin SRE elements display differential binding properties with two distinct nuclear proteins, serum response factor (SRF) and another factor described here as F-ACT1. SRF is able to bind to all actin SREs with various affinities. This multisite interaction is marked by cooperative binding events in that the two high-affinity proximal and distal SREs facilitate the weak central-site interaction with SRF, leading to the formation of a higher-order SRF-promoter complex. Functional analyses reveal that undisrupted multiple SRF-DNA interactions are absolutely essential for promoter activity in myogenic cells. F-ACT1, present at higher levels in nonmyogenic cells and replicating myoblasts than in myotubes, binds solely to the proximal SRE, and its binding is mutually exclusive with that of SRF owing to their overlapping base contacts. The cooperative promoter binding by SRF, however, can effectively displace prebound F-ACT1. In addition, an intact F-ACT1 binding site acts as a negative promoter element by restricting developmentally timed expression in myoblasts. F-ACT1 may therefore act as a repressor of skeletal alpha-actin gene transcription. This interplay between F-ACT1 and SRF may constitute a developmental as well as a physiologically regulated mechanism which modulates sarcomeric actin gene expression.