We have examined the expression and regulation of the MHC class II E beta d gene in both cell lines and in transgenic mice. In transient transfection assays, as little as 192 bp of the E beta d proximal promoter was sufficient to direct constitutive expression of a reporter gene in a B cell line and to confer inducibility by IFN-gamma in a macrophage cell line. To determine if the same E beta d promoter sequences were also sufficient to direct correct expression in vivo, E beta d transgenes bearing either 4.1 or 0.2 kb of upstream sequence were introduced into an inbred mouse strain with a non-expressed endogenous E beta gene. Expression of both transgenes mirrored the expression of the endogenous I-A protein in thymus, B cells and macrophages with regard to both constitutive and cytokine-inducible expression. These results indicate that for the E beta gene only 200 bp of proximal promoter sequence are required to achieve tissue-specific and cytokine-inducible expression. This is in striking contrast to the E alpha gene, the only other murine class II gene whose promoter has been analyzed in vivo, which has been shown to require 2.0 kb of upstream sequence for appropriate expression. These data demonstrate, therefore, that the location of critical regulatory elements for the E beta and E alpha genes may differ.