The high mobility group (HMG) I proteins are small, non-histone chromosomal proteins that promote gene activation during development and within rapidly dividing cells. They do so by facilitating enhanceosome formation on inducible genes, via both protein/DNA and protein/protein interactions. The HMG I-C gene is tightly regulated, normally being expressed exclusively during embryonic development. However, HMG I-C expression is also observed frequently in a number of tumor types, and this expression has been shown to contribute to the malignant transformation process. With the aim of dissecting pathways that lead to aberrant expression of HMG I-C in tumor cells, we have analyzed HMG I-C gene regulation in the human hepatoma cell line PLC/PRF/5. One of the two HMG I-C transcripts detected in this cell line originates from a novel downstream initiation site at nucleotide -161 relative to the first methionine. Transcription from the downstream initiation site is mediated by a PRE located between nt -222 and -217. We show here that the Sp1 and Sp3 transcription factors interact with the PRE and transactivate the HMG I-C promoter in a cooperative fashion. This study provides the first characterization of this downstream HMG I-C promoter.