The obese gene product, leptin, regulates adiposity. Mice homozygous for a nonfunctional obese gene become massively obese and develop diabetes mellitus due to overeating and increased metabolic efficiency. The cDNA sequence of obese was recently reported (Zhang, Y., Proenca, R., Maffei, M., Barone, M., Leopold, L., and Friedman, J. L. (1994) Nature 372, 425-432; Correction: (1995 Nature 374, 479). We have determined the genomic organization of the 5' end of the mouse obese gene. The coding sequence is in exons 2 and 3, A single TATA-containing promoter was found upstream of exon 1. A minority (probably similar to 5%) of the obese mRNA contained an extra, untranslated exon between exons 1 and 2. Transcription of the obese gene was detected only in adipose cells. A 762 base pair obese gene promoter driving a luciferase gene yielded abundant activity in transiently transfected rat adipose cells in primary culture. The obese promoter was inactive in erythroid K562 cells. Deletion of bases from -762 downstream to -161 did not affect promoter activity in transfected adipose cells. The -161 minimal promoter contained consensus Spl and CCAAT/enhancer-binding protein (C/EBP) motifs. Cotransfection with C/EBP alpha (a transcription factor important in adipose cell differentiation) caused 23-fold activation. These data suggest that the obese promoter is a natural target of C/EBP alpha.