Telomerase activation is thought to be a critical step in cellular immortalization and carcinogenesis. Of the three major subunits comprising human telomerase, human telomerase catalytic subunit (hTERT) has been shown to be a rate-limiting determinant of the enzymatic activity of human telomerase. However, little is known concerning how expression of hTERT is regulated in human cells. To identify the regulatory elements controlling hTERT gene expression, approximately 3.5 kb of the 5'-flanking sequence of hTERT was cloned and characterized. The promoter of hTERT was GC rich and lacked both TATA and CAAT boxes. The CapSite Hunting method identified transcription start site 19 bp upstream of the first nucleotide of the published cDNA sequence. Transient expression assays revealed that transcription of hTERT was significantly activated in cancer cell lines but repressed in normal primary cells. Using the fibroblast lineage at various stages of transformation, we found that transcription occurred in strains that had overcome replicative senescence and expressed telomerase activity. Deletion analysis of hTERT promoter identified the 181-bp core promoter region upstream of the transcription start site. Gel shift analysis revealed two major factors binding to core promoter, an E box (CACGTG) binding factor and Sp1. Overexpression of c-Myc resulted in a significant increase in transcriptional activity of the core promoter. These findings suggest that hTERT expression is strictly regulated at the transcription machinery, and that the proximal core promoter containing an E box and Sp1 sites is required for transactivation of hTERT.