In the human insulin gene, three regulatory sequences upstream of the transcription start site at -77 (the CT1 box), -210 (the CT2 box), and -315 (the CT3 box) bind a beta-cell-specific transcription factor, IUF1. Recent studies have mapped a glucose response element to a CT-like sequence in the rat insulin I gene. The present study was therefore undertaken to ascertain the role of IUF1 in glucose-stimulated insulin gene transcription. IUF1-binding activity was measured by electrophoretic mobility shift assay using the CT2 box as probe. When freshly isolated rat islets of Langerhans were incubated in medium containing low concentrations (3 mM) of glucose IUF1 activity fell to undetectable levels within 6 h. In high (20 mM) glucose IUF1 activity remained constant over a 24 h period. The loss of IUF1 activity was reversible. Thus when islets were incubated for 4 h in low glucose and transferred to high glucose, IUF1 levels recovered within 15 min. This effect was dependent on glucose metabolism as it was inhibited by mannoheptulose. Incubation of islets for 4 h in low concentrations of glucose supplemented with phosphatase inhibitors prevented the fall in IUF1 activity. No recovery in IUF1 activity was observed when islets were treated for 4 h with low glucose and then for a further 1 h with low glucose and dibutyryl cyclic AMP, or forskolin, or the phorbol ester phorbol 12-myristate 13-acetate. These results demonstrate that the IUF1-binding activity in islets of Langerhans is modulated by glucose in a phosphorylation-dependent manner, and that protein kinase A or protein kinase C are not involved. Finally, IUF1 was shown to be immunologically related to a recently cloned factor, IPF1, that binds to a CT-like sequence in the rat insulin I gene promoter.