Neuronal nicotinic acetylcholine receptor (nAChR) subunit genes compose a family of genes. The major isoform of nAChR in the brain is made up of the α4 and β2 subunits and possesses a high affinity for nicotine. To investigate the mechanisms of the regulation of the nAChR α4 gene expression in mouse, its genomic DNA was cloned and characterized. The transcription initiation site was mapped by primer extension and RNase protection experiments and localized at about 254 bp upstream of the translation initiation site. The 5′ flanking region of this gene did not have typical TATA box but GC-rich sequences were found around the initiation site. Methylation analysis of this region revealed that genomic DNAs from liver and muscle are partially methylated, whereas little methylation was observed in genomic DNA from brain. To characterize the cis-acting elements driving cell-specific expression of the α4 subunit gene, we produced lines of transgenic mice which carry a series of fragments of the α4 gene fused with bacterial lacZ as a reporter gene. An 11.5-kb DNA fragment containing 9 kb of the region upstream of the transcription initiation site and the first intron was found to confer an expression pattern which coincides rather well with the endogenous gene expression pattern at early embryonic stages, suggesting that the elements necessary for the onset of α4 gene expression are located in this region. A DNA fragment containing the 1.8-kb upstream sequence and the first intron drove expression of lacZ in a limited subset of α4 expressing cells, whereas the 1.8-kb upstream sequence alone did not elicit any significant expression. These results show that both upstream and intronic sequences are important for cell-specific expression of the nAChR α4 gene.