Genetic susceptibility to insulin-dependent diabetes mellitus (IDDM) is inherited as a polygenic trait. One of the loci implicated in IDDM is a polymorphic minisatellite 5' of the human insulin (INS) gene on chromosome 11. This insulin-linked polymorphic region (ILPR) is composed of tandemly repeated sequences, which fall into three size classes: IDDM is strongly associated with short ILPR alleles. We now show that the ILPR is capable of transducing a transcriptional signal in pancreatic beta-cells, with a long ILPR possessing greater activity than a short ILPR. The ILPR contains numerous high-affinity binding sites for the transcription factor Pur-1, and transcriptional activation by Pur-1 is modulated by naturally occurring sequences in the ILPR. Our results demonstrate a possible function for this unique minisatellite, which may have implications for type 1 diabetes.