A new member of the Rel family of transcription factors, the dorsal-related immunity factor, Dif, was recently cloned and suggested to be involved in regulating the immune response in Drosophila. Despite its classification as a Rel family member, the Dif cDNA-encoded product has not been proven previously to be a transcription factor. We now present evidence that the Dif gene product trans-activates the Drosophila Cecropin A1 gene in co-transfection assays. The transactivation requires a 40 bp upstream element including an insect kappa B-like motif. A dimer of the kappa B-like motif 5'-GGGGATTTTT inserted into a minimal promoter conferred high levels of reporter gene expression by Dif, while a multimer of several mutated versions of this motif was not activated, demonstrating the sequence specificity of Dif. Full trans-activation by Dif requires the C-terminal part of the protein. The morphogen dorsal (dl) can also activate the Cecropin A1 promoter, but to a lesser extent and in a less sequence-specific manner than Dif. Simultaneous overexpression of Dif and dl in co-transfection assays revealed that dl possesses a dominant negative effect on Dif transactivation. This study establishes that Dif is a sequence-specific transcription factor and is probably a key activator of the immune response in Drosophila.