ICP27 is an essential herpes simplex virus type 1 (HSV-1) α protein that is required for the transition from the β to the γ phase of infection. To identify functional regions of ICP27, we constructed 16 plasmids that contain nucleotide substitution mutations in the ICP27 gene. The mutations created XhoI restriction sites, altered one or two codons, and were spaced at semiregular intervals throughout the coding region. Three mutations completely inactivated an essential function of ICP27, as demonstrated by the inability of the transfected plasmids to complement the growth of an HSV-1 ICP27 deletion mutant. These mutations, M11, M15, and M16, mapped in the carboxyl-terminal one-third of ICP27 at residues 340 and 341, 465 and 466, and 488, respectively. In cotransfection assays, all three defective-plasmid mutants retained the transrepression function of ICP27 but were defective at transactivation. To define the lytic functions that are mediated by the transactivation activity of ICP27, we engineered HSV-1 recombinants containing the M11, M15, or M16 mutation. All three viral mutants failed to grow in Vero cells and possessed similar phenotypes. The viral mutants replicated their DNA similarly to the wild-type virus but showed several defects in viral gene expression. These were a failure to down-regulate α and β genes at late times after infection and an inability to induce certain γ-2 genes. Our results demonstrate that the transactivation function of ICP27 (as it is defined in cotransfection assays) mediates an essential gene regulation function during the HSV-1 infection. This activity is not required for ICP27-dependent enhancement of viral DNA replication. Our work supports and extends previous studies which suggest that ICP27 carries out two distinct regulatory activities during the HSV-1 infection.