ADIPOCYTE differentiation involves the transcriptional activation of s
everal genes in triglyceride metabolism, including the adipose P2 (aP2
or 422) gene that encodes the adipocyte lipid-binding protein ALBP(1-
3). Within the mouse aP2 promoter region, the AE1 sequence functions a
s either a positive or a negative element in the regulation of aP2 gen
e expression(4-8). The AE-1 sequence is the binding site for the posit
ive murine (3T3) adipocyte factor C/EBP-alpha(5,6), several human prea
dipocyte factors(7), and a 3T3 preadipocyte factor(s) that has been im
plicated as a repressor of aP2 gene expression(4,5,7,8). Here we repor
t the cloning of new complementary DNAs that encode the 3T3 preadipocy
te factor (termed AEBP1), and demonstrate that AEBP1 expression is abo
lished during adipocyte differentiation. Furthermore, we show that an
activity of a carboxypeptidase associated with AEBP1 is important in t
he transcriptional repression function of AEBP1. Thus AEBP1 might repr
esent a new type of transcription factor that regulates transcription
by cleavage of factors involved in transcription.