An example of autosomal dosage compensation involving the expression of the alcohol dehydrogenase (Adh) locus is described. Flies trisomic for a quarter of the length of the left arm of chromosome two, including Adh, have diploid levels of enzyme activity and alcohol dehydrogenase messenger RNA. Subdivision of the compensating trisomic into smaller ones revealed a region that exerts an inverse regulatory effect on alcohol dehydrogenase activity and messenger RNA levels and a smaller region surrounding the structural gene that exhibits a direct gene dosage response. The two opposing effects are of sufficient magnitude that they cancel when simultaneously present resulting in the observed compensation in the larger aneuploid. An Adh promoter-white structural gene fusion construct is affected by the inverse regulatory region indicating that the effect is mediated through the Adh promoter sequences. The role of autosomal dosage compensation in understanding aneuploid syndromes and karyotype evolution in Drosophila species is discussed.