An essential requirement to understand how genes contribute to genetic disease is the thorough knowledge of the transcriptional regulation of gene expression. Here, we have characterized transcription factor binding sites within the type 1 neurofibromatosis (NF1) proximal regulatory region, and addressed the molecular mechanisms that regulate NF1 transcription. Overlapping regions of the NF1 proximal promoter have been cloned and characterized for use in luciferase reporter assays. These assays have identified a 500 bp region displaying activities up to 80-fold higher than control reporter levels. Mutations at putative CRE and SP1-binding sites immediately 5' to the transcription start site have dramatic effects that lead to a 70-90% decrease in reporter activity in all cell lines tested. Gelshift assays confirm binding of CREB and SP1/KLF family members to their putative recognition sequences, and provide the first evidence identifying functional sites likely involved in regulating NF1 transcription. These assays have also revealed a putative repressor region within the NF1 promoter region corresponding to CCCTC-rich sequences between the transcription and translation start sites. This work provides new information concerning the transcriptional regulation of the NF1 gene, and is the most thorough attempt to date to map functionally relevant regions within the NF1 proximal promoter region.