Regulation of the DNA damage-inducible RAD2 gene was investigated in yeast cells transformed with centromeric plasmids containing RAD2-lacZ fusion constructs. Deletion analysis defined several regions in the 350bp region upstream of the translational start codon which are required for induction of beta-galactosidase activity. No deletions resulted in constitutively enhanced expression. We therefore conclude that induction of RAD2 by DNA-damaging agents is positively regulated. Two domains required for induction have a similar sequence and are located approximately 70 and approximately 140bp upstream of the major transcriptional start site. Four other sequence domains required for induction contain uninterrupted poly(dA) poly(dT) stretches 9-13bp long. Deletion of some of these AT-rich domains also affects constitutive expression of RAD2. Expression of RAD2 is not cell-cycle-regulated in mitotic cells. However, meiosis is accompanied by increased steady-state levels of RAD2 mRNA in the absence of DNA damage. This enhanced transcription is not dependent on the presence of upstream sequences required for regulation of induction by DNA damage. Increased steady-state levels of RAD2 mRNA are induced by cycloheximide in asynchronously dividing populations of cells, but not in non-replicating cells arrested in G1 phase of the cell cycle. Following exposure to u.v. irradiation induction is also dramatically reduced in non-replicating cells.