The human .beta.-interferon gene is regulated by an inducible enhancer element. Analysis of the effect of deletions within this element on .beta.-interferon transcription indicates that this enhancer is under negative control. Deletion of sequences from the 3'' end of the enhancer leads to a dramatic increase in the basal level of .beta.-interferon mRNA and a decrease in the induction ratio. The remaining 5'' region of the enhancer can act as a strong constitutive transcription element, and it shares considerable homology with sequences known to be required for the activity of constitutive viral enhancers. We conclude that the .beta.-interferon enhancer consists of a constitutive transcription element and a negative regulatory sequence that prevents enhancer activity prior to induction. Thus, derepression of a constitutive transcription element appears to play a key role in the control of human .beta.-interferon gene expression.