Altered regulation of 5-HT1A receptors is implicated in mood disorders such as anxiety and major depression. To provide insight into its transcriptional regulation, we previously identified a novel DNA element [14 bp 5'-repressor element (FRE)] of the 5-HT1A receptor gene that mediates repression in neuronal and non-neuronal cells (Ou et al., 2000). We have now cloned a novel DNA binding protein [five' repressor element under dual repression binding protein-1 (Freud-1)] that binds to FRE to mediate repression of the 5-HT1A receptor or heterologous promoters. Freud-1 is evolutionarily conserved and contains two DM-14 basic repeats, a predicted helix-loop-helix DNA binding domain, and a protein kinase C conserved region 2 (C2)/calcium-dependent lipid binding (CalB) calcium/phospholipid binding domain. An intact CalB domain was required for Freud-1-mediated repression. In serotonergic raphe cells, overexpression of Freud-1 repressed the 5-HT1A promoter and decreased 5-HT1A receptor protein levels, whereas transfection of antisense to Freud-1 derepressed the 5-HT1A gene and increased 5-HT1A receptor protein expression. Calcium-dependent signaling blocked Freud-1-FRE binding and derepressed the 5-HT1A promoter. Treatment with inhibitors of calmodulin or CAM-dependent protein kinase reversed calcium-mediated inhibition of Freud-1. Freud-1 RNA and protein were present in raphe nuclei, hippocampus, cortex, and hypothalamus, and Freud-1 protein was colocalized with 5-HT1A receptors, suggesting its importance in regulating 5-HT1A receptors in vivo. Thus, Freud-1 represents a novel calcium-regulated repressor that negatively regulates basal 5-HT1A receptor expression in neurons and may play a role in the altered regulation of 5-HT1A receptors associated with anxiety or major depression.