The CYC1 gene of Saccharomyces cerevisiae is positively regulated by the HAP2 and HAP3 proteins, which form a heteromeric complex that binds to a CCAAT box in the upstream activation site, UAS2, and which activate transcription in a nonfermentable carbon source. We carried out a genetic analysis to identify additional trans-acting regulatory factors exerting their effects through UAS2. We present the identification and characterization of a new locus, HAP4, which is shown to encode a subunit of the DNA-binding complex at UAS2. In the hap4 mutant, the binding of HAP2 and HAP3 (HAP2/3) is not observed in vitro. The HAP4 gene is regulated transcriptionally by a carbon source, suggesting that it encodes a regulatory subunit of the bound complex. The sequence of HAP4 shows a highly acidic region, which innactivated the protein when deleted. Replacement of this region with the activation domain of GAL4 restored activity, suggesting that it provides the principal activation domain to the bound HAP2/3/4 complex.