Multidrug resistance (MDR) is a major problem in patients with hematological malignancies. Although drug-resistance is known to be induced by the expression of P-glycoprotein (P-gp) encoded by the MDR-1 gene, little is known about the mechanisms regulating this gene. Herein, we studied the DNA methylation patterns at the enhancer and repressor binding sites of the MDR-1 gene using the human erythroleukemia cell line K562 and its multidrug resistant derivative K562/ADM (adriamycin). Direct DNA sequence analysis demonstrated methylation to be present at the repressor site (minus 110 GC-box) of the MDR-1 gene in K562/ADM cells, but not in parental K562 cells. Methylation-specific PCR (MSP) analysis yielded similar results. Treatment of K562/ADM cells with 5-Aza-2'-deoxycytidine (decitabine; DAC), an inhibitor of DNA methyltransferase, caused demethylation of the repressor binding site of MDR-1 gene, as assessed by MSP, and also decreased P-gp expression, as assessed by flow cytometric and Northern blot analysis. Although it is generally accepted that DAC upregulates gene expression by demethylating the activator binding sites, our present results suggest that DAC induces down-regulation of P-gp expression as a result of demethylation at the repressor binding site in K562/ADM cells. In this regard, methylation-dependent regulation of the MDR-1 gene in K562/ADM cells is unique.