Steroid hormone receptors activate specific gene transcription by binding as hormone-receptor complexes to short DNA enhancer-like elements termed hormone response elements (HREs). We have shown previously that a highly conserved 66 amino acid region of the oestrogen (ER) and glucocorticoid (GR) receptors, which corresponds to part of the receptor DNA binding domain (region C) is responsible for determining the specificity of target gene activation. This region contains two sub-regions (CI and CII) analogous to the 'zinc-fingers' of the transcription factor TFIIIA. We show here that CI and CII appear to be separate domains both involved in DNA binding. Furthermore, using chimaeric ERs in which either the first (N-terminal) (CI) or second (CII) 'zinc finger' region has been exchanged with that of the GR, indicates that it is the first 'zinc finger' which largely determines target gene specificity. We suggest that receptor recognition of the HRE is analogous to that of the helix-turn-helix DNA binding motif in that the receptor binds to DNA as a dimer with the first 'zinc finger' lying in the major groove recognizing one half of the palindromic HRE, and that protein-DNA interaction is stabilized through non-specific DNA binding and dimer interactions contributed by the second 'zinc finger'.