Spermatidal protein TP2, which appears transiently during stages 12-16 of mammalian spermiogenesis, is a DNA condensing zinc metalloprotein with a preference to GC-rich DNA. We have carried out a detailed sitedirected mutagenesis analysis of rat spermatidal protein TP2 to delineate the amino acid residues involved in coordination with two atoms of zinc. Two zinc fingers modules have been identified involving 4 histidine and 4 cysteine residues, respectively. The modular structure of the two zinc fingers identified in TP2 define a new class of zinc finger proteins that do not fall into any of the known classes of zinc fingers. Transfection experiments with COS-7 cells using wild type and the two zinc finger pocket mutants have shown that TP2 preferentially localizes to nucleolus. The nuclear localization signal in TP2 was identified to be 87 GKVSKRKAV 95 present in the C-terminal third of TP2 as a part of an extended NoLS sequence.Spermiogenesis is an elaborate process of cellular differentiation wherein the haploid spermatids produced following meiotic division finally mature into spermatozoa. In mammals, in particular, it is characterized by the transient appearance of a group of proteins, namely TP1, TP2, and TP4 which replace the somatic and testis-specific histones, before themselves being replaced by protamines (1). The biological significance of the role of transition proteins in chromatin remodeling, in mammals, is a matter of great importance to understand the final stages of sperm development and maturation in the testis. Among the three basic proteins, TP1, TP2, and TP4, TP1 was shown to be a DNA melting protein in vitro and has been speculated to be involved in the destabilization of nucleosome to facilitate displacement of histones (2, 3). More recently Yu et al. (4) have shown that TP1-deficient mice have abnormal spermatogenesis with reduced fertility. TP4 has been shown recently to stimulate SV40 DNA relaxing activity of eukaryotic DNA topoisomerase I suggesting a probable role in chromatin reorganization (5). On the other hand, more information is available regarding DNA binding properties of TP2. TP2, in contrast with TP1, was shown to have DNA condensing properties (6). Rat TP2 is a zinc metalloprotein, containing two atoms of zinc per molecule (7), condenses GC-rich DNA more than other types of DNA sequences (8), and recognizes a human CpG island sequence in a zinc-dependent manner (9). Methylation of cysteine residue in the CpG doublet inhibited the recognition of the CpG island sequence by TP2. Chromomycin A 3 interference experiments revealed that probably one of the modes of interaction of TP2 with GC-rich DNA is through its minor groove. These results suggested that CpG islands might serve as specific loci for initiation of chromatin condensation by TP2 through its zinc-binding domain.For a better understanding of the nature of interaction of TP2 with DNA, it is necessary to delineate the zinc-binding domains of TP2. A careful examination of the amino acid sequence of rat TP2 and its al...