In the PC12 neuroendocrine line, the neuronal nicotinic acetylcholine receptor alpha3 gene promoter is activated by SCIP/Tst-1/Oct-6, a POU domain transcription factor proposed to be important for regulating the development of specific neural cell populations. In this study, we have investigated the SCIP polypeptide domains involved in alpha3 promoter activation. The characteristics of activation by a chimeric effector in which the GAL4 DNA binding domain was substituted for the SCIP POU domain were dramatically different from those of wild-type SCIP. At low effector masses, the chimeric polypeptide weakly activated alpha3 in a GAL4 binding-site-dependent manner but then squelched transcription at higher masses. In contrast, wild-type SCIP activation was not modulated by the presence of multimerized SCIP binding sites, and squelching was not observed. Analysis of wild-type SCIP truncations revealed that deletion of the previously characterized SCIP amino-terminal activation domain did not destroy activity of the factor. Surprisingly, a truncation expressing nothing more than the POU domain was nearly as active as wild-type SCIP. Moreover, cotransfection of a GAL4-VP16 effector with an effector expressing just the SCIP POU domain resulted in synergistic activation of the promoter. Synergistic activation did not depend on an Sp1 motif that is the only functional alpha3 cis element outside the transcription start site region. Our results show that the DNA binding domain of a POU factor is capable of transcriptional activation probably through protein-protein interactions with components of the basal transcription complex.