DNA replication of the adenovirus genome complexed with viral core proteins is dependent on the host factor designated template activating factor I (TAF-I) in addition to factors required for replication of the naked genome. Recently, we have purified TAF-I as 39- and 41-kDa polypeptides from HeLa cells. Here we describe the cloning of two human cDNAs encoding TAF-I. Nucleotide sequence analysis revealed that the 39-kDa polypeptide corresponds to the protein encoded by the set gene, which is the part of the putative oncogene associated with acute undifferentiated leukemia when translocated to the can gene. The 41-kDa protein contains the same amino acid sequence as the 39-kDa protein except that short N-terminal regions differ in both proteins. Recombinant proteins, which were purified from extracts of Escherichia coli, expressing the proteins from cloned cDNAs, possessed TAF-I activities in the in vitro replication assay. A particular feature of TAF-I proteins is the presence of a long acidic tail in the C-terminal region, which is thought to be an essential part of the SET-CAN fusion protein. Studies with mutant TAF-I proteins devoid of this acidic region indicated that the acidic region is essential for TAF-I activity.