The neu (c- erbB-2 or HER2 ) proto-oncogene which encodes a receptor protein homologous to the epidermal growth factor receptor is overexpressed in 20%-30% of human breast and ovarian cancers. Oncogenic activation of Neu can also occur through multiple molecular mechanisms, including a point mutation in the transmembrane domain, deletion of the extracellular domain and short in-frame deletions of 7-12 amino acids in the extracellular region proximal to the transmembrane domain. Because of the highly vascularized phenotype of breast and ovarian cancers and the contribution of the Neu receptor to the development and progression of these tumors, we investigated the effect of Neu on the expression of the tumor angiogenesis factor VEGF. Expression of various activated Neu receptors but not wild-type Neu in Rat-1 cells, leads to increased VEGF expression on mRNA as well as on protein level. This effect is mediated by transcriptional activation of the VEGF promoter via a cluster of Sp 1 binding sites. Molecular analysis of the activation mechanism of Sp 1 revealed that neither the VEGF promoter binding activity of Sp 1 nor the expression of Sp 1 is affected by Neu transformation of the cells. Instead, functional Neu-induced transactivation of Sp 1 was observed by using a GAL4-based transactivation assay. These results demonstrate that functional changes of the transcription factor Sp 1 mediates a Neu-signaling cascade leading to VEGF promoter activation.