The approximately 1000 nucleotide long upstream regulatory region (URR) of bovine papilloma virus-1 (BPV-1) contains a cis element which responds to trans-activation by a diffusible factor encoded in the viral E2 open reading frame (ORF). A series of URR DNA fragments have been linked to two heterologous genes, bacterial chloramphenicol acetyl transferase (cat) or herpes simplex virus-1 thymidine kinase (tk), and tested in transient transfection assays for transcription initiating at the authentic upstream early viral promoter, P89. Transcriptional activity of the P89 promoter was greatly elevated in the presence of the E2 trans-activator gene product. The E2-responsive cis element (E2R) of P89 has been mapped to sequences -277 to -131 nucleotides upstream from the transcription start site (BPV nucleotide 89). The E2R element functioned as a strong transcriptional enhancer in cis with the SV40 early or the tk promoter in the presence, but not in the absence, of the E2 gene product. However, several heterologous promoters which lack sequences related to the E2R element were also trans-activated in transient cotransfections by a function encoded in the E2 ORF of BPV-1, albeit to a much lesser extent. In addition to activation of early viral gene transcription, the E2 regulatory gene(s) may therefore have the potential to alter cellular gene expression.