ATBF1 is a 306-kDa protein containing four homeodomains, 17 zinc finger motifs, and several segments potentially involved in transcriptional regulation (T. Morinaga, H. Yasuda, T. Hashimoto, K. Higashio, and T. Tamaoki, Mol. Cell. Biol. 11: 6041-6049, 1991). At least one of the homeodomains of ATBF1 binds to an AT-rich element in the human α-fetoprotein (AFP) enhancer (enhancer AT motif). In the present work, we analyzed the transcriptional regulatory activity of ATBF1 with respect to the enhancer AT motif and similar AT-rich elements in the human AFP promoter and the human albumin promoter and enhancer. Gel retardation assays showed that ATBF1 binds to the AFP enhancer AT motif efficiently; however, it binds weakly or not at all to other AT-rich elements in the AFP and albumin regulatory regions studied. Alterations of the enhancer AT motif by site-specific mutagenesis resulted in the loss of binding of ATBF1. Cotransfection experiments with an ATBF1 expression plasmid and the chloramphenicol acetyltransferase (CAT) gene fused to AFP promoter or enhancer fragments showed that ATBF1 suppressed the activity of AFP enhancer and promoter regions containing AT-rich elements. This suppression was reduced when the mutated AT motifs with low affinity to ATBF1 were linked to the CAT gene. The ATBF1 suppression of AFP promoter and enhancer activities appeared to be due, at least in part, to competition between ATBF1 and HNF1 for the same binding site. In contrast to the AFP promoter and enhancer, the albumin promoter and enhancer were not affected by ATBF1, although they contain homologous AT-rich elements. These results show that ATBF1 is able to distinguish AFP and albumin AT-rich elements, leading to selective suppression of the AFP promoter and enhancer activities.