Nuclear orpan receptors are members of the superfamily of structurally related, ligand-inducible transcription factors for which no ligand has yet been identified. Over the past few years many nuclear orphan receptors have been cloned, but only for the retinoid X receptor (RXR) has a natural ligand (9-cis-retinoic acid) been found. Here we report the identification of melatonin as a ligand for the recently cloned orphan receptor retinoid Z receptor beta (RZR beta). We found RZR beta expression in the rat brain nearly coincident with binding sites for the pineal gland hormone melatonin (5-methoxy-N-acetyltryptamine). We show here binding and activation of RZR beta by melatonin with Kd and EC50 values in the low nanomolar range. A nuclear signaling pathway for melatonin may contribute to some of the diverse and profound effects of this hormone, for example, in the context of circadian rhythmicity.