Signal transducer and activator of transcription 3 (Stat3) is a key regulator of gene expression in response to signaling of the glycoprotein 130 (gp130) family cytokines, including interleukin 6, oncostatin M, and leukemia inhibitory factor. Many efforts have been made to identify Stat3 target genes and to understand the mechanism of how Stat3 regulates gene expression. Using the microarray technique, hundreds of genes have been documented to be potential Stat3 target genes in different cell types. However, only a small fraction of these genes have been proven to be true direct Stat3 target genes. Here we report the identification of novel direct Stat3 target genes using a genome-wide screening procedure based on the chromatin immunoprecipitation method. These novel Stat3 target genes are involved in a diverse array of biological processes such as oncogenesis, cell growth, and differentiation. We show that Stat3 can act as both a repressor and activator on its direct target genes. We further show that most of the novel Stat3 direct target genes are dependent on Stat3 for their transcriptional regulation. In addition, using a physiological cell system, we demonstrate that Stat3 is required for the transcriptional regulation of two of the newly identified direct Stat3 target genes important for muscle differentiation.The signal transducer and activator of transcription (STAT) 2 family of transcriptional regulators is activated in response to extracellular signaling proteins, including cytokines and growth factors (1, 2). When cytokines bind to their cell surface receptors, the receptor-associated JAK tyrosine kinases become activated and in turn phosphorylate a single tyrosine residue in the STAT molecule. The phosphorylated STATs then enter the nucleus as dimers and bind to specific DNA sequences in the promoters of their target genes to regulate transcription. Although the seven members of the STAT family have similarity in their molecular structure and function, they play diverse physiological roles in a wide variety of biological processes (3).One member of the STAT family, Stat3, mediates the signaling of cytokines that share the gp130 receptor chain, which include interleukin-6, oncostatin M (OSM), and leukemia inhibitory factor (LIF) (4, 5). In response to gp130 ligand stimulation, Stat3 is phosphorylated on Tyr-705 and forms dimers through phosphotyrosine-Src homology 2 domain interactions (6). The dimerized Stat3 molecules enter the nucleus and bind to a consensus DNA sequence in the promoters of its target genes to regulate transcription (7). The transcriptional activity of Stat3 is mediated by its transcription activation domain located in the carboxyl-terminal end of the molecule (8). In addition to the tyrosine phosphorylation, the Stat3 transcription activation domain contains a serine residue (Ser-724) that is also phosphorylated to achieve maximum transcription activity (9, 10). Analyses of Stat3-dependent enhancersomes demonstrate that Stat3 interacts and recruits other transcription factors and ...