The insulin response element (IRE) in the IGFBP-1 promoter, and in other gene promoters, contains a T(A/G)TTT motif essential for insulin inhibition of transcription. Studies presented here test whether FKHR may be the transcription factor that confers insulin inhibition through this IRE motif. Immunoblots using antiserum to the synthetic peptide FKHR413-480, RNase protection, and Northerns blots show that FKHR is expressed in HEP G2 human hepatoma cells. Southwestern blots, electromobility shift assays, and DNase I protection assays show that Escherichia coli-expressed GST-FKHR binds specifically to IREs from the IGFBP-1, PEPCK and TAT genes; however, unlike HNF3β, another protein proposed to be the insulin regulated factor, GST-FKHR does not bind the insulin unresponsive G/C-A/C mutation of the IGFBP-1 IRE. When HEP G2 cells were cotransfected with FKHR expression vectors and with IGFBP-1 promoter plasmids containing either native or mutant IREs, FKHR expression induced a 5-fold increase in activity of the native IGFBP-1 promoter but no increase in activity of promoter constructs containing insulin unresponsive IRE mutants. These data suggest that FKHR, and/or a related family member, is the important T(G/A)TTT binding protein that confers the inhibitory effect of insulin on gene transcription.