The protooncogene c-fos has been implicated in the control of proliferation and transformation of fibroblasts, and its protein product is an essential component of transcription factor AP1. The important target genes and, hence, the molecular mechanism of Fos function are, however, still unknown, partly due to the lack of a tightly regulated Fos-induction system. Here we show that different activities of the Fos protein can be controlled hormonally by fusing the mouse c-Fos protein to the ligand-binding domain of either the rat glucocorticoid or the human estrogen receptor. These fusion proteins stimulate AP1-dependent transcription and repress endogenous fos mRNA synthesis in a strictly hormone-dependent manner. Expression of these chimeric proteins in rat fibroblasts results in fast, reversible, and tightly controlled transformation in response to hormone. A Fos-estrogen receptor expressing cell line was used to isolate Fos-responsive genes by subtractive cDNA cloning. Run-on analysis of one of these genes showed that its transcription is rapidly and directly regulated by the hormone-activated Fos-estrogen receptor protein, demonstrating the potential of this induction system for identifying Fos target genes.