Transcription enhancer factor-1 (TEF-1) has been implicated in transactivating a placental enhancer (CSEn) that regulates human chorionic somatomammotropin (hCS) gene activity. We demonstrated that TEF-1 represses hCS promoter activity in choriocarcinoma (BeWo) cells (Jiang, S.W., and Eberhardt, N.L. (1995) J. Biol. Chem. 270, 13609-13915), suggesting that TEF-1 interacts with basal transcription factors. Here we demonstrate that hTEF-1 overexpression inhibits minimal hCS promoters containing TATA and/or initiator elements, Rous sarcoma virus and thymidine kinase promoters in BeWo cells. Cotransfection of TEF-1 antisense oligonucleotides alleviated exogenous TEF-1-mediated repression and increased basal hCS promoter activity, indicating that endogenous TEF-1 exerts repressor activity. GST-TEF-1 fusion peptides fixed to glutathione-Sepharose beads retained in vitro-generated human TATA-binding protein, hTBP. The TEF-1 proline-rich domain was essential for TBP binding, but polypeptides also containing the zinc finger domain bound TBP with higher apparent affinity. TBP supershifted hTEF-GT-IIC DNA complexes, but TEF-1 inhibited in vitro binding of TBP to the TATA motif. Coexpression of TBP and TEF-1 in BeWo cells alleviated TEF-1-mediated transrepression, indicating that the TBP-TEF-1 interaction is functional in vivo. The data indicate that TEF-1 transrepression is mediated by direct interactions with TBP, possibly by inhibiting preinitiation complex formation.