We have identified ecdysone-response elements (EcREs) by studying regulation of the steroid-responsive Drosophila Eip28/29 gene. First, functional assays of deletion mutants identified large sequence regions required for the response; then a blotting method using the specifically labeled steroid receptor as probe identified receptor-binding regions. Three short receptor-binding regions near Eip28/29 have been identified: Prox and Dist [521 and 2295 nucleotides, respectively, downstream of the poly(A) site] are probably required for the Eip28/29 response in cell lines; Upstream (-440) is unnecessary for that response. We have also demonstrated that an EcRE-containing region from hsp27 contains a receptor-binding site. Each of these four receptor-binding regions functions as an EcRE when placed upstream of an ecdysone nonresponsive promoter and each contains an imperfect palindrome, suggesting the consensus 5'-RG(GT)TCANTGA(CA)CY-3'. Furthermore, a synthetic 15-bp fragment containing an imperfect palindrome similar to the consensus is a fully functional EcRE. The presence of any of the EcREs leads, in the absence of hormone, to depressed gene expression. When hormone is added, it relieves this repression and causes additional activation. The similarity of the EcRE sequence to response elements for estrogen, thyroid hormone, and retinoic acid receptors suggests that the steroid receptors and their signal transduction mechanisms have been strongly and broadly conserved.