Surfactant protein B (SP-B) is selectively expressed in bronchiolar and alveolar epithelial cells of the lung. We identified an upstream enhancer located in the 5'-flanking region of the human SP-B gene (-439 to -331 base pair, hSP-B(-439/-331)) by deletion analysis of SP-B-luciferase constructs assessed in transfection assays in vitro. The element cis-activated the expression of an SV40 promoter-luciferase reporter gene in a human pulmonary adenocarcinoma cell line (H441-4). Three distinct binding sites for the nuclear transcription protein, thyroid transcription factor 1 (TTF-1), were identified, and the purified TTF-1 homeodomain was bound to bhe region of hSP-B(-439/-331). Co-transfection of H441-4 cells with the expression vector pCMV-TTF-1 trans-activated the native human SP-B promoter and the SV40 promoter fused with the SP-B enhancer. Mutations of the TTF-1 binding sites in the upstream enhancer blocked TTF-1 binding and transactivation activity. In summary, TTF-1 interacts with distinct proximal (-80 to -110) and distal (-439 to -331) cis-acting elements than regulate lung epithelial cell-specific transcription of the human SP-B gene.