The transcription factor EGR-1 is a potential regulator of over 30 genes and plays a role in growth, development, and differentiation and, in addition, has significant transformation suppression activity. The regulatory properties are reviewed and a hypothesis for the transformation suppression activity is proposed. EGR-1 contains three "zinc-finger" motifs in the C-terminal portion of the molecule that constitute the DNA-binding domain and interact with the promoters by virtue of two classes of GC-rich elements: single GC-elements (GCEs) with the consensus 5'-T-G-C-G-T/g-G/A-G-G-C/a/t-G-G/T-3' and overlapping sites consisting of an Sp-1 binding site and the GCE consensus or close homolog of these sequences. The Wilm's tumor suppressor gene product WT1 interacts with the same GCE and, owing in part to four alternate splice products, interacts with a broader range of GC-rich elements with the consensus 5'-GNGNGGGNG-3' and 5'-TCCTCCTCCTCCTC-3'. WT1 commonly but not invariably acts as repressor of transcription, whereas EGR-1, in the absence of overlapping Sp-1 binding sequences, is often an activator. The well-known rapid response of the EGR-1 gene following mitogenic stimulation together with the occurrence of GCEs in the promoters of many growth factors and protooncogenes suggests a role of EGR-1 in growth. Moreover, EGR-1 is constitutively expressed in several viral-transformed systems. On the other hand, studies of model and human tumor lines reveal that EGR-1 has significant growth and transformation suppression roles. Recent studies show that this effect can be accounted for by the ability of EGR-1 to induce the expression and secretion of TGF-beta1, a potent growth suppressor of many cell types, by binding to a single GCE of the TGF-beta1 promoter. Although the effects of EGR- at overlapping Sp1/EGR-1 DNA binding sites are not predictable, known cases fall into two loose groups. Sp1 is usually activating and increasing concentrations of EGR-1 lead to displacement that results in either inhibition of transactivation or EGR-1-dependent transactivation. Moreover, recent studies suggest that displaced Sp1 binds to and activates the endogenous Egr-1 gene, thereby leading to "facilitated inhibition" of Sp1 function by the resulting increased EGR-1. This effect may augment the growth suppressive function of EGR-1 based on induction of TGF-beta1.