Mouse-based in vivo and in vitro studies revealed that epithelial colonic CD98 mRNA expression was transcriptionally increased in intestinal inflammation. We then isolated and characterized a 5'-flanking fragment containing the promoter region required for CD98 gene transcription. Primer extension and rapid amplification of 5'-cDNA ends were used to map a transcriptional initiation site 129 bp upstream from the translational start codon. Sequencing of the 5'-flanking region revealed the presence of four GC-rich Sp1 binding domains, one NF-B binding domain and no TATA-box. Binding of Sp1 [Sp1(-874), SP1(-386), Sp1(-187) and Sp1(-177)] and NF- B (-213)) to the promoter was confirmed by electrophoretic mobility shift and super shift assays. Furthermore, chromatin immunoprecipitation studies show the in vivo DNA-Sp1 and DNA-NF-B interactions in the basal and interferon stimulated conditions. A reporter gene driven by serially truncated and site-mutated CD98 promoters were used to examine basal and INF-gamma-responsive transcription in transiently transfected Caco2-BBE cells. Our results revealed that Sp1(-187), Sp1(-177) and the NF-B binding site were essential for basal and INF -stimulated CD98 promoter activities, while Sp1(-874) and Sp1(-386) were not. The results from additional site-mutated CD98 promoters suggested that Sp1(-187), Sp1(-177) and the NF-B site may cooperate in mediating basal and INF -stimulated CD98 promoter activities. Finally, we demonstrated that reduction of Sp1 or NF-b expression reduced CD98 protein expression in un-stimulated and in interferon gamma stimulated Caco2-BBE. Collectively, these findings indicate that the Sp1 and NF-B transcription factors play a role in INF--mediated transcriptional regulation of CD98 in the intestinal epithelium.