The Drosophila GAGA factor self-oligomerizes both in vivo and in vitro. GAGA oligomerization depends on the presence of the N-terminal POZ domain and the formation of dimers, tetramers, and oligomers of high stoichiometry is observed in vitro. GAGA oligomers bind DNA with high affinity and specificity, As a consequence of its multimeric character, the interaction of GAGA with DNA fragments carrying several GAGA binding sites is multivalent and of higher affinity than its interaction with fragments containing single short sites. A single GAGA oligomer is capable of binding adjacent GAGA binding sites spaced by as many as 20 base pairs. GAGA oligomers are functionally active, being transcriptionally competent in vitro. GAG;A-dependent transcription activation depends strongly on the number of GAGA binding sites present in the promoter. The POZ domain is not necessary for in vitro transcription but, in its absence, no synergism is observed on increasing the number of binding sites contained within the promoter. These results are discussed in view of the distribution of GAGA binding sites that, most frequently, form clusters of relatively short sites spaced by small variable distances.