Endothelium differentiates in response to tissue-specific signals; brain endothelium expresses tight junctions and transporters which are absent from other endothelia. The promoter of the tight junction protein occludin exhibited strong activity in a brain endothelial cell line, hCMEC/D3 but was inactive in lung endothelial cells. Expression of occludin in brain endothelium corresponded with binding of Sp3 to a minimal promoter segment close to the transcription-start site. However, in lung endothelium Sp-transcription factors did not bind to this site although they are present in the cell nucleus. In contrast, repression of occludin in lung endothelium was associated with the binding of YY1 to a remote site in the promoter region, which was functionally inactive in brain endothelium. The work identified a group of transcription factors including Sp3 and YY1, which differentially interact with the occludin promoter to induce expression of occludin in brain endothelium and repression in other endothelia. The mechanism controlling occludin expression is similar to that which controls tissue-specific expression of the transferrin receptor in brain endothelium, leading to a scheme for endothelial differentiation, in which activation or repression of tissue-specific proteins is maintained by a set of transcription factors which include Sp3 and YY1.