A family displaying hereditary persistence of alpha-fetoprotein (HPAFP) in adult life was detected in an antenatal screening programme for spina bifida. RFLP linkage analysis shows that the trait is linked with the albumin-AFP locus. The molecular mechanism responsible for the post-natal repression of the AFP gene is unknown. We wished to determine the molecular mechanism underlying HPAFP in this family. Sequence analysis of the 5'-flanking sequences of their gene revealed a GA substitution at position -119 associated with the trait. This substitution occurs in a potential HNF I binding site, and increases the similarity of the sequence to a consensus HNF I recognition site. In a competitive gel retardation assay the mutant sequence binds HNF I alpha more tightly than the wild type sequence. Furthermore, 5'-flanking sequences of the human AFP gene containing the G-->A substitution direct a higher level of CAT expression in transfected human hepatoma cells than the wild type sequences. We conclude that the G-->A substitution at position -119 of the AFP gene is the mutation causing HPAFP in this family. These results highlight the importance of this HNF I binding site in the developmental regulation of the AFP gene.