Pax4 is a paired-box transcription factor that plays an important role in the development of pancreatic β-cells. Two Pax4 cDNAs were isolated from a rat insulinoma library. One contained the full-length sequence of Pax4. The other, termed Pax4c, was identical to Pax4 but lacked the sequences encoding 117 amino acids at the COOH-terminus. Pax4 was found to inhibit the human insulin promoter through a sequence element, the C2 box, located at −253 to −244, and the islet amyloid polypeptide promoter through a sequence element located downstream of −138. The inhibitory activity of Pax4 was mapped to separate regions of the protein between amino acids 2–230 and 231–349.