Glucose metabolism in the liver activates the transcription of various genes encoding enzymes of glycolysis and lipogenesis and also G6pc (glucose-6-phosphatase). Allosteric mechanisms involving glucose 6-phosphate or xylulose 5-phosphate and covalent modification of ChREBP (carbohydrate-response element-binding protein) have been implicated in this mechanism. However, evidence supporting an essential role for a specific metabolite or pathway in hepatocytes remains equivocal. By using diverse substrates and inhibitors and a kinase-deficient bisphosphatase-active variant of the bifunctional enzyme PFK2/FBP2 (6-phosphofructo-2-kinase-fructose-2,6-bisphosphatase), we demonstrate an essential role for fructose 2,6-bisphosphate in the induction of G6pc and other ChREBP target genes by glucose. Selective depletion of fructose 2,6-bisphosphate inhibits glucose-induced recruitment of ChREBP to the G6pc promoter and also induction of G6pc by xylitol and gluconeogenic precursors. The requirement for fructose 2,6-bisphosphate for ChREBP recruitment to the promoter does not exclude the involvement of additional metabolites acting either co-ordinately or at downstream sites. Glucose raises fructose 2,6-bisphosphate levels in hepatocytes by reversing the phosphorylation of PFK2/FBP2 at Ser32, but also independently of Ser32 dephosphorylation. This supports a role for the bifunctional enzyme as the phosphometabolite sensor and for its product, fructose 2,6-bisphosphate, as the metabolic signal for substrate-regulated ChREBP-mediated expression of G6pc and other ChREBP target genes.