The defective terminal differentiation of osteoclasts in mice homozygous for the mi allele of the microphthalmia transcription factor (MITF) gene implies that MITF plays a critical role in regulating gene expression during osteoclast ontogeny. To begin addressing the role of this transcription factor in the osteoclast, target genes need to be identified. In the present work, several lines of evidence show that the gene encoding the enzyme tartrate-resistant acid phosphatase (TRAP) is a target of MITF. Analysis of osteoclasts in vivo in the embryonic forelimb showed that MITF and TRAP RNA were coexpressed in a dynamic pattern during the process of endochondral ossification of long bone. Primary osteoclast-like cells (OCLs) produced from mi/mi mutant mice expressed TRAP messenger RNA (mRNA) at 8-fold lower levels than in OCLs derived from normal mice, indicating a direct link between MITF function and TRAP expression. The activity of mouse TRAP promoter-reporter genes was assayed in the primary OCLs by DNA-mediated transfection, and this activity was shown to depend on a conserved sequence (GGTCATGTGAG) located in the proximal promoter. Recombinant MITF protein recognized specifically this conserved sequence element. Expression of a TRAP promoter-green fluorescent protein (GFP) transgene mimicked the expression of the endogenous TRAP gene during differentiation of osteoclast-like cells, and the expression of the transgene was decreased 8-fold when placed into the mutant mi/mi background. These results are consistent with a role for MITF in gene expression during terminal differentiation of the osteoclast and will allow osteoclast-specific mechanisms of gene regulation to be studied in greater detail.