Insulin-like growth factor binding protein-3 (IGFBP-3) is a well documented growth inhibitor and pro-apoptotic factor. IGFBP-3 mRNA and its protein are overexpressed by senescent human diploid fibroblasts. However, the mechanism responsible for the up-regulation of its expression is still unclear. This report describes a novel transcriptional regulatory element, IGFBP-3 enhancer element (IEE), identified in the 5' untranslated region of the IGFBP-3 gene. This element differentially activates IGFBP-3 expression in senescent versus young fibroblasts. Electrophoretic mobility shift assays revealed abundant complexes in senescent cell nuclear extracts compared with young cell nuclear extracts. Similar to young proliferative cells, young quiescent cells showed reduced binding activity; enhancement of this activity was specific to senescent cells and not an effect of cell cycle arrest. The DNase I footprint revealed the protein-binding core sequence within the IEE through which the protein binds the IEE. Site-directed mutagenesis within IEE abolished binding activity and selectively decreased IGFBP-3 promoter activity in senescent (but not young) cells. Furthermore, introduction of an IEE decoy suppressed the endogenous IGFBP-3 gene expression specifically in senescent cells. These results point to the IEE as being a positive transcription regulatory element that contributes to the up-regulation of IGFBP-3 during cellular senescence.