The IFN-γ regulation of the HLA-DRA gene was examined in a primary cell type, the astrocyte. Site-specific mutagenesis of the DRA promoter reveals that three known sequences, S, X, and Y, are required for an optimal IFN-γ response. Specifically for the X sequence, the X1, but not the X2, site is involved in IFN-γ regulation of HLA-DRA in the astrocyte. Most interesting, a novel IFN-γ-enhanced protein (IFNEX) with specificity for the X element has consistently been observed in nuclear extracts made from primary astrocytes. The correlation of the functional importance of X1 in IFN-γ- regulated DRA expression and the enhancement of IFNEX by IFN-γ strongly suggests that IFNEX may play a crucial role in IFN-γ-regulated class II MHC gene expression.