Thyroid hormone has been shown to rapidly stimulate the rate of rat growth hormone gene transcription which parallels the kinetics of binding of 3,5,3'-triiodo-L-thyronine (L-T3) to its nuclear receptor (Yaffe, B. M., and Samuels, H. H. (1984) J. Biol. Chem. 259, 6284-6291). We have constructed a chimeric gene to explore whether the 5'-flanking region of the rat growth hormone gene contains a DNA element which could mediate thyroid hormone control of growth hormone gene expression. The construct consists of 1.8 kilobase pairs of the 5'-flanking region extending 11 nucleotides downstream from the transcription initiation (cap) site ligated to Escherichia coli DNA containing the structural gene for the enzyme xanthine-guanine phosphoribosyltransferase. GC cells, a growth hormone producing rat pituitary cell line, were transfected with this chimeric gene and stable transformants in which the enzyme is regulated by L-T3 were isolated by positive selection using mycophenolic acid and xanthine. These stable transformants develop with relatively high frequency and show marked L-T3 stimulation of xanthine-guanine phosphoribosyltransferase mRNA which is initiated at the cap site of the growth hormone gene. This study provides the first evidence that the 5'-flanking region of the rat growth hormone gene contains a DNA regulatory element which can mediate control of gene expression by thyroid hormone.