Hypoxia-inducible factor-1 (HIF-1), a heterodimeric DNA binding complex composed of two basic-helix-loop-helix Per-AHR-ARNT-Sim proteins (HIF-1α and -1β), is a key component of a widely operative transcriptional response activated by hypoxia, cobaltous ions, and iron chelation. To identify regions of HIF-1 subunits responsible for oxygen-regulated activity, we constructed chimeric genes in which portions of coding sequence from HIF-1 genes were either linked to a heterologous DNA binding domain or encoded between such a DNA binding domain and a constitutive activation domain. Sequences from HIF- 1α but not HIF-1β conferred oxygen-regulated activity. Two minimal domains within HIF-1α (amino acids 549-582 and amino acids 775-826) were defined by deletional analysis, each of which could act independently to convey inducible responses. Both these regions confer transcriptional activation, and in both cases adjacent sequences appeared functionally repressive in transactivation assays. The inducible operation of the first domain, but not the second, involved major changes in the level of the activator fusion protein in transfected cells, inclusion of this sequence being associated with a marked reduction of expressed protein level in normoxic cells, which was relieved by stimulation with hypoxia, cobaltous ions, or iron chelation. These results lead us to propose a dual mechanism of activation in which the operation of an inducible activation domain is amplified by regulation of transcription factor abundance, most likely occurring through changes in protein stability.