We investigated the mechanisms of MDR1 gene activation by CCAAT/enhancer binding protein beta (C/EBPbeta, or nuclear factor for interleukin 6) in human cancer cells. Transfection of the breast cancer cell line MCF-7 and its doxorubicin-selected variant MCF-7/ADR by either C/EBPbeta or C/EBPbeta-LIP (a dominant-negative form of C/EBPbeta) confirmed their roles in the activation or repression of the endogenous, chromosomally embedded MDR1 gene. Cotransfection experiments with promoter constructs revealed a C/EBPbeta interaction on the MDR1 promoter via the region within -128 to -75. Deletions within the putative AP-1 box (-123 to -111) increased MDR1 promoter activity when stimulated by C/EBPbeta, suggesting that the AP-1 site negatively regulates MDR1 activation by C/EBPbeta. Mutations within the inverted CCAAT box (Y box) (-82 to -73) abolished the C/EBPbeta-stimulated MDR1 promoter activity, indicating that the Y box is required for MDR1 activation by C/EBPbeta. Chromatin immunoprecipitation (ChIP) revealed that C/EBPbeta precipitates a transcription complex containing C/EBPbeta, the MDR1 promoter sequences (-250 to +54), and the hBrm protein. In conclusion, alteration of expression or function of C/EBPbeta plays an important role in MDR1 gene regulation. C/EBPbeta activates the endogenous MDR1 gene of MCF-7 cells, and this activation was associated with a novel C/EBPbeta interaction region within the proximal MDR1 promoter (-128 to -75). The mechanisms of MDR1 activation by C/EBPbeta include C/EBPbeta binding of the chromatin of the MDR1 gene and interactions of C/EBPbeta with the Y box and Y box-associated proteins.