Human lecithin:cholesterol acyltransferase (LCAT) circulates in plasma bound to high density lipoproteins (HDL) and modulates the rate by which cholesteryl ester is transported to the liver. So far, little is known about the regulation of the expression of the LCAT gene. In this study we have defined the cis-elements, identified the trans-acting factors and demonstrated their functional effects and significance in determining transcriptional activity of the proximal LCAT promoter. Using deletion mutants having 5' variable ends (from nucleotides -72 to -27), we have identified the presence of two non-consensus GC-rich regions that stimulate transcription in HepG2 and HeLa cells. These regions designated sites A (-29 to -47) and B (-49 to -65) contain the CCTCC core sequence which in electromobility shift analysis is critical for the formation of two DNA-protein complexes designated I and II. Site-directed mutagenesis suggests that both sites are equally important in promoter activity, and that cooperative interactions between both sites are not required for activity. Electromobility shift and supershift experiments using oligonucleotides spanning sites A and B identified Sp1 and Sp3 as the transcription factors interacting at these sites. To determine the significance and functional effects that Sp1 and Sp3 have in regulating LCAT promoter activity, we performed transfection experiments in Drosophila SL-2 cells as they lack endogenous Sp1 and Sp3. Sp1 but not Sp3 activates the human LCAT promoter and when Sp1 is co-transfected along with Sp3, Sp3 functions as a dose-dependent repressor of Sp1-mediated activation. These findings indicate that Sp1 is capable of transactivating a reporter gene linked to the LCAT promoter containing Sp binding sites and suggests that the levels of Sp3 or the nuclear Sp1/Sp3 ratio may play an important role in determining the transcriptional activity of the LCAT promoter in vivo.