We show that mutation at the GLN3 locus results in decreased steady-state levels of DAL7, DUR1,2, CAR1, and URA3 mRNAs derived from cultures grown in the presence of inducer. Basal levels of these RNA species, however, were not significantly affected by a gln3 mutation. The GLN3 product appears to affect gene expression in two ways. The pleiotropic requirement of GLN3 for induced gene expression probably derives from the need of the GLN3 product for inducer uptake into the cell and its loss in gln3 mutants. We also demonstrate that transcriptional activation, mediated by the DAL5 and DAL7 upstream activation sequences, requires a functional GLN3 gene product. This observation identified transcriptional activation as the most likely point of GLN3 participation in the expression of allantoin system genes.