The 80-kDa IE2 nuclear phosphoprotein encoded by the human cytomegalovirus (HCMV) major immediate-early (MIE) gene behaves both as a nonspecific transactivator of heterologous reporter genes and as a specific repressor of its own promoter-enhancer region. To begin to examine the biochemical properties of the IE2 protein, we prepared panels of N-terminal and C-terminal truncation mutants by in vitro translation procedures. In cross-linking experiments, the C-terminal half of IE2 (which is sufficient for down-regulation) formed dimers but N-terminal segments did not do so. Cotranslated Oct2/IE2 fusion proteins containing the same IE2 C-terminal region from codons 266 to 579 also formed mixed-subunit DNA-bound oligomeric complexes in gel mobility shift assays. Furthermore, an IE2 domain bounded by codons 388 to 542 proved to immunoprecipitate as heterodimers with cotranslated subunits containing known epitopes for specific antibodies. Deletion up to codon 428 or truncation back to codon 504 prevented this interaction. In direct gel shift DNA-binding assays, a bacterial GST/IE2(346-579) fusion protein bound to a 30-mer oligonucleotide probe encompassing the major immediate-early gene negative cis-regulatory target DNA sequence but failed to bind to a single-base-pair insertion mutant probe (delta CRS). This specific DNA-binding activity was abolished by further deletion up to codon 388 on the N-terminal side or by truncation at codon 542 on the C-terminal side. Therefore, the minimal DNA-binding domain requires additional amino acid motifs on both sides of the dimerization domain. This segment of IE2 is functionally important for both transactivation and down-regulation and contains several highly conserved amino acid motifs that are shared amongst the equivalent HCMV, simian CMV, mouse CMV, rat CMV, and human herpesvirus 6 proteins from other betaherpesviruses.