In Aspergillus nidulans the positive-acting, wide domain regulatory gene areA mediates nitrogen metabolite repression. Previous analysis demonstrated that the C-terminal 153 residues of the areA product (AREA) are inessential for at least partial expression of most genes subject to regulation by areA. Paradoxically, areAr2, a -1 frameshift replacing the wild-type 122 C-terminal residues with a mutant peptide of 117 amino acids, leads to general loss of function. To determine the basis for the areAr2 mutant phenotype, and as a means of delineating functional domains within the C-terminal region of AREA, we have selected and characterised areAr2 revertants. Deletion analysis, utilising direct gene replacement, extended this analysis. A mutant areA product truncated immediately after the last residue of the highly conserved GATA (DNA-binding) domain retains partial function. The areAr2 product retains some function with respect to the expression of uaZ (encoding urate oxidase) and the mutant allele is partially dominant with respect to nitrate reductase levels. Consistent with the areAr2 product having a debilitating biological activity, we have demonstrated that a polypeptide containing both the wild-type DNA-binding domain and the mutant C-terminus of AREA2 is able to bind DNA in vitro but no longer shows specificity for GATA sequences.