The molecular mechanism by which cAMP activates the rat phenylethanolamine N-methyltransferase (PNMT) gene was examined by transient transfection of the wild-type rat PNMT promoter-luciferase reporter gene construct pGL3RP893 into PC12 cells. Forskolin treatment (10 microM) of the transfected cells for 3--6 h maximally induced luciferase threefold. Induction by forskolin was mimicked by the cAMP analog, 8-Br-cAMP, and prevented in PC12 cells pretreated with the protein kinase A (PKA) inhibitor H-89 or co-transfected with an expression construct for PKI, a polypeptide inhibitor of PKA. Furthermore, forskolin did not activate the PNMT promoter when the 893 bp PNMT promoter-reporter gene construct was transfected into the PKA-deficient cell line, A126. Detailed examination of the forskolin responsiveness of PNMT constructs harboring > or = 60 bp and < 893 bp of PNMT promoter demonstrated that the cAMP-responsive element(s) lay between < 392 bp and > or =60 bp. Within this region of the promoter lies a functional binding element for Egr-1, a transcriptional activator of the PNMT gene. Forskolin treatment of PC12 cells also rapidly increased nuclear levels of Egr-1 and the catalytic subunit of PKA (PKA-C), with the rise in PKA-C preceding that of Egr-1. Mutation of the --165 bp Egr-1 site markedly decreased forskolin activation of the PNMT promoter. These findings demonstrate that the rat PNMT gene promoter can be activated via the cAMP-PKA signal transduction pathway, mediated by the immediate early gene transcription factor, Egr-1.