Transcriptional activators, several different coactivators, and general transcription factors are necessary to access specific loci in the dense chromatin structure to allow precise initiation of RNA polymerase II (Pol II) transcription. Histone acetyltransferase (HAT) complexes were implicated in loosening the chromatin around promoters and thus in gene activation. Here we demonstrate that the 2 MDa GCN5 HAT-containing metazoan TFTC/STAGA complexes contain a histone H2A and H2B deubiquitinase activity. We have identified three additional subunits of TFTC/STAGA (ATXN7L3, USP22, and ENY2) that form the deubiquitination module. Importantly, we found that this module is an enhancer of position effect variegation in Drosophila. Furthermore, we demonstrate that ATXN7L3, USP22, and ENY2 are required as cofactors for the full transcriptional activity by nuclear receptors. Thus, the deubiquitinase activity of the TFTC/STAGA HAT complex is necessary to counteract heterochromatin silencing and acts as a positive cofactor for activation by nuclear receptors in vivo.

SAGA/TFTC-type multiprotein complexes play important roles in the regulation of transcription. We have investigated the importance of the nuclear positioning of a gene, its transcription and the consequent export of the nascent mRNA. We show that E(y)2 is a subunit of the SAGA/TFTCtype histone acetyl transferase complex in Drosophila and that E(y)2 concentrates at the nuclear periphery. We demonstrate an interaction between E(y)2 and the nuclear pore complex (NPC) and show that SAGA/TFTC also contacts the NPC at the nuclear periphery. E(y)2 forms also a complex with X-linked male sterile 2 (Xmas-2) to regulate mRNA transport both in normal conditions and after heat shock. Importantly, E(y)2 and Xmas-2 knockdown decreases the contact between the heat-shock protein 70 (hsp70) gene loci and the nuclear envelope before and after activation and interferes with transcription. Thus, E(y)2 and Xmas-2 together with SAGA/TFTC function in the anchoring of a subset of transcription sites to the NPCs to achieve efficient transcription and mRNA export.

Chromatin insulators affect interactions between promoters and enhancers/silencers and function as barriers for spreading of repressive chromatin. The Su(Hw) protein is responsible for activity of the best-studied Drosophila insulators. Here we demonstrate that an evolutionarily conserved protein, E(y)2/Sus1, is recruited to the Su(Hw) insulators via binding to the zinc-finger domain of Su(Hw). Partial inactivation of E(y)2 in a weak mutation, e(y)2(u1), impairs only the barrier, but not the enhancer-blocking, activity of the Su(Hw) insulators. Whereas neither su(Hw)(-) nor e(y)2(u1) affects fly viability, their combination proves lethal, testifying to functional interaction between Su(Hw) and E(y)2 in vivo. Apparently, different domains of Su(Hw) recruit proteins responsible for enhancer-blocking and for the barrier activity.

The Drosophila TATA box-binding protein (TBP)-related factor 2 (TRF2 or TLF) was shown to control a subset of genes different from that controlled by TBP. Here, we have investigated the structure and functions of the trf2 gene. We demonstrate that it encodes two protein isoforms: the previously described 75-kDa TRF2 and a newly identified 175-kDa version in which the same sequence is preceded by a long N-terminal domain with coiled-coil motifs. Chromatography of Drosophila embryo extracts revealed that the long TRF2 is part of a multiprotein complex also containing ISWI. Both TRF2 forms are detected at the same sites on polytene chromosomes and have the same expression patterns, suggesting that they fulfill similar functions. A study of the manifestations of the trf2 mutation suggests an essential role of TRF2 during embryonic Drosophila development. The trf2 gene is strongly expressed in germ line cells of adult flies. High levels of TRF2 are found in nuclei of primary spermatocytes and trophocytes with intense transcription. In ovaries, TRF2 is present both in actively transcribing nurse cells and in the transcriptionally inactive oocyte nuclei. Moreover, TRF2 is essential for premeiotic chromatin condensation and proper differentiation of germ cells of both sexes.To initiate transcription, each eukaryotic RNA polymerase requires a set of general transcription factors. TFIID, composed of the TATA box-binding protein (TBP) and TBP-associated factors (TAFs), recognizes the core promoter in a sequence-specific manner and is thought to be the only sequence-specific factor that operates with RNA polymerase II (4, 51). The C-terminal core domain of TBP is highly conserved among eukaryotes and contains two symmetrical repeats that fold into a saddle-like structure essential for interaction with the promoter sequences (24,25).A second gene encoding a protein with high homology to the core domain of TBP, TBP-like factor (TLF; also called TRF2 or TLP), was detected in metazoan species (11,23,30,34,38,39,40,41,52). Like TBP, most members of the TLF family have a bipartite structure with a variable N-terminal domain and the highly conserved C-terminal core domain containing two direct repeats (11). TLF was shown to mediate polymerase II transcription initiation and to interact with TFIIA and TFIIB to form a preinitiation complex. However, TLF does not bind to the classical TATA box elements and has been shown to control a set of genes different from those controlled by TBP (12,34,40,41,45,50).Sequence comparison of core domains in the TLF family reveals that they are less conserved in evolution (40 to 45% identity among the metazoan species) than the TBP core domains (about 80% identity between yeast and humans). Thus, while the role of TBP is similar in different species, the function of TLF may have evolved into different regulatory pathways in evolutionarily distant species (11). Studies on the physiological function of TLF in Caenorhabditis elegans, Xenopus laevis, and Danio rerio have demonstrated that TLF is essenti...