The alpha subunit of the placental hormone chorionic gonadotropin is regulated by cyclic AMP (cAMP) at the transcriptional level. A cAMP-responsive fusion gene (alpha-CAT) containing 1.5 kilobases of the alpha gene 5'-flanking sequence linked to the chloramphenicol acetyltransferase (CAT) gene was used as a transcriptional reporter in competition assays in transfected JEG-3 choriocarcinoma cells. Expression of the alpha-CAT fusion gene increased linearly with increasing amounts of transfected plasmid and was maximal at the same amount of alpha-CAT DNA (2 micrograms) with or without cAMP treatment. Various amounts of different competitor DNA sequences were cotransfected with the alpha-CAT reporter plasmid to examine the interactions of intracellular trans-acting factors with the regulatory elements of the alpha gene promoter. An 800-base-pair fragment of alpha gene 5'-flanking sequence inhibited both basal and cAMP-stimulated transcription of the alpha-CAT reporter plasmid in a dose-dependent manner, indicative of interactions with one or more trans-acting factors that activate alpha gene expression. The alpha gene sequences that interact with intracellular regulatory factors were defined by using several discrete regions of the 5'-flanking sequence as competitors for alpha-CAT expression. A proximal promoter sequence (-99 to +44) containing the CCAAT box, TATA box, and transcriptional initiation site was a relatively ineffective competitor of alpha-CAT transcription. In contrast, an upstream sequence between -236 and -100 was an effective competitor for transcriptional activators of alpha-CAT expression. Competition for alpha-CAT expression by this regulatory sequence did not require cis interactions with downstream promoter elements and was equally effective with or without cAMP treatment. An 18-base-pair repeated sequence within this region of the alpha gene (-146 to -111) greatly enhanced both basal gene expression and cAMP responsivity and also competed for limiting cellular transcription factors. These findings suggest that JEG-3 cells contain trans-acting factors that interact with a cAMP response element to activate alpha gene transcription. The chorionic gonadotropin beta gene 5'-flanking sequence also competed for alpha-CAT expression, suggesting that a common trans-acting factor is shared by the regulatory sequences of the alpha and beta genes.