Sterol-regulated transcription of the farnesyl diphosphate (FPP) synthase gene is dependent on two cis elements in the proximal promoter. These elements, an inverted CCAAT box and sterol regulatory element 3 (SRE-3), bind NF-Y and sterol regulatory element-binding protein 1 (SREBP-1), respectively. We now demonstrate that the binding of recombinant SREBP-1 to its cognate site (SRE-3) within the FPP synthase promoter in vitro is enhanced by binding of NF-Y to the upstream inverted CCAAT box. Using an FPP synthase promoter fragment containing the binding sites for both NF-Y and SREBP-1 in gel mobility shift assays, we demonstrate that the addition of NF-Y increases the binding of SREBP-1 to SRE-3 over 20-fold. In contrast, NF-Y does not stimulate the binding of SREBP-1 to SRE-3 when the inverted CCAAT box is either mutated or 4 base pairs (bp) are inserted between the inverted CCAAT box and SRE-3. Promoter-reporter genes, containing either the wild-type FPP synthase promoter sequence or containing the 4-bp insertion between the inverted CCAAT box and SRE-3, were transiently transfected into cells. The activity of the wild-type promoter-reporter gene increased when the cells were either incubated in sterol-depleted medium or were co-transfected with an expression vector encoding transcriptionally active SREBP-1. This increase in activity was attenuated when the promoter contained the 4-bp insert, consistent with defective binding of SREBP to the promoter in vivo. These studies suggest that the binding of SREBP-1 to SRE-3 in the FPP synthase promoter, and subsequent stimulation of transcription, is dependent on synergistic binding and a functional interaction between SREBP-1 and NF-Y.