IFN-γ is a potent inducer of class II MHC Ags on different cell types, including the astrocyte. TNF-α alone has no effect on class II MHC expression, but enhances IFN-γ-induced class II expression. IFN-γ acts by inducing transcription of the class II gene, and TNF-α enhances the rate of IFN-γ-induced transcription. We have previously described two factors, IFN- γ-enhanced factor X (IFNEX) and TNF-α induced complex X (TIC-X), whose expression is induced by IFN-γ and IFN-γ/TNF-α, respectively, which interacted with the X box of the DRA promoter. In this study, we show that IFNEX and TIC-X bind to the X2 core, with contacts extending into the 3' end of X1 and into the spacer region of the DRA promoter. We also show a functional correlation between binding activity and transcriptional activity of the DRA promoter. These results strongly suggest that both IFNEX and TIC- X play important roles in the regulation of class II MHC gene expression in the astrocyte.