Expression of the Drosophila melanogaster alcohol dehydrogenase-encoding gene (ADH) in the adult fat body is controlled by the ADH adult enhancer site (AAE). The D. melanogaster transcription repressor, adult enhancer factor-1 (AEF-1), binds to AAE at a site which overlaps with a sequence recognized by the mammalian transcription factor, CCAAT/enhancer-binding protein alpha [C/EBP alpha; Falb and Maniatis, Genes Dev. 6 (1992a) 454-465]. C/EBP alpha also activates the promoter of the rat class-I ADH gene in a sequence-specific manner [Potter et al., Arch. Biochem. Biophys. 285 (1991a) 246-251]. In this study, we explored the possibility that D. melanogaster AEF-1 influences transcription of the rat class-I ADH. By DNase I footprint analysis, bacterially produced AEF-1 protects a region of DNA between nucleotides (nt) -22 and -36 of the rat class-I ADH promoter (pADH), just 5' to the binding site of C/EBP alpha, a result confirmed by the electrophoretic mobility shift assay (EMSA). Co-transfection of a rat pADH-CAT reporter construct with expression vectors containing C/EBP alpha, AEF-1, or both, indicates that AEF-1 inhibits induction of the rat pADH by C/EBP alpha. Moreover, rat liver nuclear extracts appear to contain AEF-1-like-binding activities to AAE by EMSA. These experiments suggest an evolutionarily conserved mechanism by which AEF-1 modulates expression of the D. melanogaster and rat ADH genes.