Treatment of synovial fibroblasts with retinoic acid (RA) decreases their expression of collagenase (matrix metalloproteinase-1 or MMP-1), an enzyme that degrades interstitial collagens and contributes to the pathology of rheumatoid arthritis. This inhibition results, at least in part, from RA-induced decreases in the mRNA for the transactivators Fos and Jun (with concominant increases in RAR mRNA) and by sequestration of Fos/Jun by RARs/RXRs. Previously, we provided evidence that retinoid receptors are also present in complexes that bind to fragments of rabbit MMP-1 promoter DNA containing an AP-1 site at -77 (Pan et al., 1995, J. Cell. Biochem., 57:575-589). However, it was unclear whether RARs and retinoid X receptors (RXRs) were binding directly to the DNA or indirectly through another protein. We now use a sensitive MMP-1 promoter/luciferase reporter construct to confirm the transcriptional role of the AP-1 site at -77. In addition, with electrophoretic mobility shift analyses (EMSAs), antibody "supershifts" and DNAase 1 footprinting, we examine the interaction of retinoid receptors and AP-1 protein on the MMP-1 promoter. We demonstrate that RARs, RXRs, and c-Jun form a complex at the AP-1 site in which c-Jun binds directly to the DNA and apparently tethers the retinoid receptors to the complex. We conclude that retinoid receptors/AP-1 protein interactions at the DNA may provide an additional means of controlling collagenase gene transcription by retinoids.