We recently demonstrated that cyclic GMP (cGMP)-dependent protein kinase (G-kinase) activates the human fos promoter in a strictly cGMP-dependent manner (T. Gudi et al., J. Biol. Chem. 271:4597-4600, 1996). Here, we demonstrate that G-kinase translocates to the nucleus by an active transport mechanism which requires a nuclear localization signal (NLS) and is regulated by cGMP. Immunofluorescent staining of G-kinase was predominantly cytoplasmic in untreated cells, but intense nuclear staining appeared in 8-bromo (Br)-cGMP-treated cells. We identified a putative NLS in the G-kinase ATP binding domain which resembles the NLS of the interleukin-1alpha precursor. Fusion of the G-kinase NLS to the N terminus of beta-galactosidase produced a chimeric protein which localized to the nucleus. Mutation of a single amino acid residue (K407-->E) within the G-kinase NLS produced an enzyme with normal cGMP-dependent activity in vitro which did not translocate to the nucleus and did not transactivate the fos promoter in the presence of 8-Br-cGMP in vivo. In contrast, N-terminally truncated versions of G-kinase with constitutive, cGMP-independent activity in vitro localized to the nucleus and transactivated the fos promoter in the absence of 8-Br-cGMP. These results indicate that nuclear localization of G-kinase is required for transcriptional activation of the fos promoter and suggest that a conformational change of the kinase, induced by cGMP binding or by removal of the N-terminal autoinhibitory domain, functionally activates an otherwise cryptic NLS.