An endogenous suppressor of Hairy-wing insulator separates regulatory domains in Drosophila

insulators define independent domains of gene function throughout the genome. The Drosophila gypsy insulator was isolated from the gypsy retrotransposon as a region that contains a cluster of binding sites for the Suppressor of Hairy-wing [Su(Hw)] protein. To study the effects of the gypsy insulator on gene expression within a single genomic domain, targeted gene replacement was used to exchange the endogenous yellow gene, located at cytological location 1 A, with a set of gypsy-modified yellow genes. Replaced yellow genes carried a gypsy insulator positioned between the yellow promoter and either the upstream or the downstream tissue-specific enhancers. Whereas the gypsy insulator blocked the function of the upstream enhancers at the endogenous location, the downstream enhancers were not blocked. Investigation of the 1A region revealed two clustered Su(Hw)-binding sites downstream of the yellow gene, named 1A-2, that bind Su(Hw) in vivo and possess enhancer blocking function. We propose that interaction between 1A-2 and the gypsy insulator permits activation of yellow expression by enhancers in the neighboring achaete-scute complex, causing an apparent absence of the block of the downstream yellow enhancers. Based on these data, we suggest that 1A-2 is an endogenous Su(Hw) insulator that separates regulatory domains within the Drosophila genome.