c-jun proto-oncogene expression is extinguished in cells transformed by v-Jun; however, the mechanistic basis of this phenomenon has not been elucidated. c-jun mRNA levels are greatly reduced in v-Jun-transformed cells, and we show that this reduction is associated with a similar decrease in the rate of c-jun transcription. Transcriptional down-regulation was also evident in functional assays in which the c-jun gene promoter was approximately 10-fold less active in v-Jun-transformed cells than it was in normal cells. This reduction was largely attributable to a conserved 12-O-tetradecanoylphorbol-13-acetate-responsive element (TRE)-like motif at position -72 (the proximal junTRE) that was essential for efficient basal expression in normal cells but that conferred little, if any, detectable transcriptional activity in v-Jun-transformed cells. DNA-binding analysis showed that this element was recognized by a mixture of c-Jun/Fra and cyclic AMP-responsive element-binding protein/activating transcription factor-like complexes in normal cells but that v-Jun/Fra heterodimers predominated in v-Jun-transformed cells. Furthermore, ectopic expression of v-Jun repressed c-jun promoter activity in normal cells through the proximal junTRE. Thus, the deficit in transcription mediated by the junTRE correlates with and is most likely attributable to binding of v-Jun to this element in vivo. We also find that the c-jun promoter is refractory to induction via the stress-activated protein kinase/c-jun NH2-terminal kinase pathway in v-Jun-transformed cells, suggesting that v-Jun interferes with signal-regulated gene expression. Therefore, c-jun is an example of a cellular gene, the transcription of which is regulated negatively by v-Jun in vivo.