We examined the molecular basis by which T3 regulates the human cholesterol 7alpha-hydroxylase gene (CYP7A1) promoter. L-T3 decreased chloramphenicol acetyltransferase activity in hepatoma cells cotransfected with a plasmid encoding the T3 receptor (TR) alpha [NR1a1] and a chimeric gene containing nucleotides -372 to +61 of the human CYP7A1 gene fused to the chloramphenicol acetyltransferase structural gene. Deoxyribonuclease I footprinting revealed that recombinant TRalpha protected two regions in this segment of the human CYP7A1 gene promoter. In EMSAs, TRalpha bound to both regions. The binding was competed by oligonucleotides bearing an idealized TRalpha binding motif and abolished by mutation of these elements. In assays of promoter function, mutation of only one of the TRalpha binding sites blocked repression by T3. The results indicate that T3-dependent repression of human CYP7A1 gene expression is mediated via a novel site in the human CYP7A1 gene promoter.