Uga3p, a member of zinc binuclear cluster transcription factor family, is required for gamma-aminobutyric acid-dependent transcription of the UGA genes in Saccharomyces cerevisiae. Members of this family bind to CGG triplets with the spacer region between the triplets being an important specificity determinant. A conserved 19-nucleotide activation element in certain UGA gene promoter regions contains a CCGN(4)CGG-everted repeat proposed to be the binding site of Uga3p, UAS(GABA). The function of conserved nucleotides flanking the everted repeat has not been rigorously investigated. The interaction of Uga3p with UAS(GABA) was characterized in terms of binding in vitro and transcriptional activation of lacZ reporter genes in vivo. Electromobility shift assays using mutant UAS(GABA) sequences and heterologously produced full-length Uga3p demonstrated that UAS(GABA) consists of two independent Uga3p binding sites. Simultaneous occupation of both Uga3p binding sites of UAS(GABA) with high affinity is essential for GABA-dependent transcriptional activation in vivo. We present evidence that the two Uga3p molecules bound to UAS(GABA) probably interact with each other and show that Uga3p((1-124)), previously used for binding studies, is not functionally equivalent to the full-length protein with respect to binding in vitro. We propose that the Uga3p binding site is an asymmetric site of 5'-SGCGGNWTTT-3' (S = G or C, W = A, or T and n = no nucleotide or G). However, UAS(GABA), is a palindrome containing two asymmetric Uga3p binding sites.