The Cercospora nicotianae CRG1 gene is involved in cellular resistance to the perylenequinone toxin, cercosporin, that generates highly toxic singlet oxygen upon exposure to light. The entire open reading frame (ORF) of CRG1 was isolated and sequenced. The gene contains an ORF of 1950bp including a 65-bp intron. The predicted 650 amino acid CRG1 protein contains a Cys(6)Zn(2) binuclear cluster DNA-binding motif with homology to various fungal regulatory proteins, indicating that CRG1 may act functionally as a transcription activator. Targeted gene disruption of CRG1 resulted in mutants that are partially sensitive to cercosporin and reduced in cercosporin production. Genetic complementation revealed that CRG1 fully restored cercosporin resistance, but only slightly restored cercosporin production in a UV-derived mutant (CS10) containing a single nucleotide substitution in crg1. Complementation of a crg1-null mutant, however, yielded strains that are similar to the wild-type in both phenotypes. These results indicate that the transcription regulator CRG1 is involved in the activation of genes associated with cercosporin resistance and production in the fungus Cercospora nicotianae.