As shown by Witten the N = 1 supersymmetric gauged Wess-Zumino-Witten
(WZW) model based on a group G has an extended N = 2 supersymmetry if
the gauged subgroup H is so chosen that G/H is Kahler type. We extend
Witten's result and prove that the N = 1 supersymmetric gauged WZW mod
els over G x U(1) are actually invariant under N = 4 superconformal tr
ansformations if the gauged subgroup H is such that G/[H x SU(2)] is a
quaternionic symmetric space. A previous construction of ''maximal''
N = 4 superconformal algebras with SU(2) x SU(2) x U(1) symmetry is re
formulated and further developed so as to relate them to the N = 4 gau
ged WZW models. Based on earlier results we expect the quantization of
N = 4 gauged WZW models to yield the unitary realizations of maximal
N = 4 superconformal algebras provided by this construction.