Little is known about the molecular mechanisms by which STAT proteins promote tumorigenesis. Drosophila is an ideal system for investigating this issue, as there is a single STAT (Stat92E), and its hyperactivation causes overgrowths resembling human tumors. Here we report the first identification of a dominant-active Stat92E protein, Stat92E(DeltaNDeltaC), which lacks both N- and C-termini. Mis-expression of Stat92E(DeltaNDeltaC)in vivo causes melanotic tumors, while in vitro it transactivates a Stat92E-luciferase reporter in the absence of stimulation. These gain-of-function phenotypes require phosphorylation of Y(711) and dimer formation with full-length Stat92E. Furthermore, a single point mutation, an R(442P) substitution in the DNA-binding domain, abolishes Stat92E function. Recombinant Stat92E(R442P) translocates to the nucleus following activation but fails to function in all assays tested. Interestingly, R(442) is conserved in most STATs in higher organisms, suggesting conservation of function. Modeling of Stat92E indicates that R(442) may contact the minor groove of DNA via invariant TC bases in the consensus binding element bound by all STAT proteins. We conclude that the N- and C- termini function unexpectedly in negatively regulating Stat92E activity, possibly by decreasing dimer dephosphorylation or increasing stability of DNA interaction, and that Stat92E(R442) has a nuclear function by altering dimer:DNA binding.
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