The ZFY gene, located in the sex-determining region of the human Y chromosome, appears to encode a zinc-finger protein. Two homologous genes, Zfy-1 and Zfy-2, are found in the sex-determining region of the mouse Y chromosome. One or both genes may serve as the primary sex-determining signal in mice. Both Zfy-1 and Zfy-2 are transcribed in the adult testis. Nucleotide sequence analysis of a Zfy-2 cDNA suggests that it encodes a 783 amino acid protein with two domains: the amino-terminal portion is highly acidic, with 25% of its residues being glutamic or aspartic acid, while the carboxy-terminal domain contains 13 zinc fingers. The presence in Zfy-2 of an acidic domain in combination with a putative nucleic acid binding domain suggests that Zfy-2 activates transcription in a sequence-specific fashion.