Expression of β-galactosidase from a nrd-lacZfusion was used to determine the role in nrd regulation of an inverted sequence upstream of the promoter. Removal or replacement of a 45bp inverted repeat with an altered sequence including a 48bp perfect inverted repeat resulted in a mutant phenotype that was low in nrd expression in an exponentially growing culture and that did not increase during DNA synthesis inhibition. Changing the 22bp in the upstream half of the inverted repeat resulted in the same phenotype, whereas changing the 22 bp in the downstream half of the inverted repeat decreased nrd expression to a lesser extent in an exponentially growing culture and had only a smaller effect on nrd expression during DNA synthesis inhibition. As other mutants with the phenotype of the upstream inverted repeat mutant were found to lack cell cycle regulation, expression of nrd- lac mRNA produced from a plasmid with this mutation in the nrd-lacZfusion gene was compared with nrd mRNA produced from the chromosomal nrd gene in a synchronized culture. The results indicated that the upstream half of the nrd inverted repeat contains a cis-acting element essential for nrd cell cycle regulation.