Abstract In this study we analysed the outcome of the interaction between HPV-16 L2 and E2 on the transactivation and DNA replication functions of E2. When E2 was expressed on its own, it transactivated a number of E2-responsive promoters but co-expression of L2 led to the down-regulation of the transcription transactivation activity of the E2 protein. This repression is not mediated by an increased degradation of the E2 protein. In contrast, the expression of L2 had no effect on the ability of E2 to activate DNA replication in association with the viral replication factor E1. Deletion mutagenesis identified L2 domains responsible for binding to E2 (first 50 N-terminus amino acid residues) and down-regulating its transactivation function (residues 301–400). The results demonstrate that L2 selectively inhibits the transcriptional activation property of E2 and that there is a direct interaction between the two proteins, although this is not sufficient to mediate the transcriptional repression. The consequences of the L2–E2 interaction for the viral life cycle are discussed.