The study of zinc finger proteins has revealed their potential to act as oncogenes or tumor suppressors. Here we report the molecular, biochemical, and functional characterization of KS1 (KRAB/zinc finger suppressor protein 1), a novel, ubiquitously expressed zinc finger gene initially isolated from a rat pancreas library. KS1 contains 10 C2H2 zinc fingers, a KRAB-A/B motif, and an ID sequence that has been shown previously to participate in growth factor-regulated gene expression. Northern blot analysis using pancreatic cell lines demonstrates that KS1 mRNA is inducible by serum and epidermal growth factor, suggesting a role for this gene in cell growth regulation. Biochemical analysis reveals that KS1 is a nuclear protein containing two transcriptional repressor domains, R1 and R2. R1 corresponds to the KRAB-A motif, whereas R2 represents a novel sequence. Transformation assays using NIH3T3 cells demonstrate that KS1 suppresses transformation by the potent oncogenes Ha-ras, Galpha12, and Galpha13. Deletion of the R1/ KRAB-A domain does not modify the transformation suppressive activity of KS1, whereas deletion of R2 abolishes this function. Thus, KS1 is a novel growth factor-inducible zinc finger transcriptional repressor protein with the potential to protect against neoplastic transformation induced by several oncogenes.