We have utilized a genetic selection system in yeast to identify novel estrogen-responsive genes within the human genome and to define the sequences in the BRCA-1 gene responsible for its estrogen responsiveness. This approach led to the identification of a new subclass within the Alu family of DNA repeats which have diverged from known Alu sequences and have acquired the ability to function as estrogen receptor-dependent enhancers. Importantly, these new elements confer receptor-dependent estrogen responsiveness to a heterologous promoter when assayed in mammalian cells. This transcriptional activity can be attenuated by the addition of either of three different classes of estrogen receptor antagonists, indicating that these elements function as classical estrogen receptor-dependent enhancers. Furthermore, this enhancer activity is restricted to a specific subset of DNA repeats because consensus Alu elements of four major subfamilies do not respond to the estrogen receptor. Previously, most Alu sequences have been considered to be functionally inert. However, this work provides strong evidence that a significant subset can confer estrogen responsiveness upon a promoter within which they are located. Clearly, Alu sequences must now be considered as important contributors to the regulation of gene transcription in estrogen receptor-containing cells.