Progressive multifocal leukoencephalopathy (PML) is a fatal demyelinating disease that results from an oligodendrocyte infection caused by JC virus. The JC virus early promoter directs cell-specific expression of the viral replication factor large T antigen, and thus transcriptional regulation constitutes a major mechanism of glial tropism in PML. We have previously demonstrated that T antigen controls the JC virus basal promoter in a glial cell-specific manner, since T antigen repressed the JC virus and simian virus 40 (SV40) early promoters in glioma cells but induced strong activation of the JC virus early promoter in nonglial cells. To further analyze these findings, T antigen and nuclear extracts from glial and nonglial cells were used to examine DNase I footprints on the proximal promoter. T-antigen binding to site II was more extensive than expected based on sequence homology with SV40, and nuclear proteins protected several regions of the proximal promoter in a cell-specific manner. Multiple Sp1 binding domains were identified. Site-directed mutagenesis revealed that T- antigen-mediated activation required a TATA box sequence, a pentanucleotide repeat immediately upstream of the TATA box, and an Sp1 binding site downstream of the TATA box. When footprints were obtained with mutant promoters which blocked T-antigen-induced transactivation, no change in T- antigen binding was observed. These results suggest that T antigen activates the JC virus basal promoter in nonglial cells by interaction with the transcription initiation complex.