2,3,7,8-Tetrachlorodibenzo-p-dioxin (TCDD) and related compounds elicit diverse toxic and biochemical responses in laboratory animals and mammalian cells in culture. TCDD induces CYP1A1 gene expression and results of extensive research have delineated the molecular mechanism of this response. In target cells, TCDD initially binds to the aryl hydrocarbon (Ah) receptor which accumulates in the nucleus as an Ah-receptor:aryl hydrocarbon nuclear translocator (Arnt) protein heterodimeric complex. The nuclear Ah receptor complex acts as a ligand-induced transcription factor which binds to transacting genomic dioxin/xenobiotic responsive elements (DREs/XREs) located in the 5'-regulatory region upstream from the initiation start site and this interaction results in transactivation of gene transcription. DREs have been identified in several other genes which are induced by TCDD, including CYP1A2, aldehyde-3-dehydrogenase, NAD(P)H quinone oxidoreductase, and glutathione S transferase Ya and similar induction response pathways have been observed or proposed. However, TCDD and other Ah receptor agonists also inhibit expression of several genes and research in this laboratory has investigated inhibition of estrogen (E2)-induced genes including uterine epidermal growth factor, c-fos protooncogene, and the progesterone receptor, estrogen receptor (ER) and cathepsin D genes in human breast cancer cell lines. In MCF-7 human breast cancer cells, E2 induces cathepsin D gene expression and this is associated with formation of an ER/Sp1 complex at the sequence in the promoter region (-199/-165) of this gene. Within 30 min TCDD causes a rapid inhibition of E2-induced cathepsin D gene expression in MCF-7 cells. Moreover, using a series of synthetic oligonucleotides which include the wild-type ER/Sp1 and various mutants, it was shown by gel electromobility shift and transient transfection assays that the nuclear Ah receptor complex binds to an imperfect DRE located between the ER and Sp1 binding sequences. This interaction results in disruption of the ER/Sp1 complex and inhibition of E2-induced gene expression. These results illustrate that the nuclear Ah receptor complex also exhibits activity as a negative transcription factor via a mechanism which is similar to that reported for Ah receptor-mediated induction of gene expression.