Southwestern (DNA-protein) screening of a murine L-cell cDNA library by using a probe for the μE3 site in the immunoglobulin heavy-chain enhancer yielded a clone, mTFE3, which is a member of the subset of basic helix-loop-helix (BHLH) proteins that also contain a leucine zipper (ZIP). Since the individual contribution of these domains is not well understood for proteins which contain them both, mutational analyses were performed to assess the functional roles of the HLH and ZIP regions for DNA binding and multimerization. The HLH region is stringently required for DNA binding but not for multimerization. The ZIP region is not stringently required for binding or multimerization, but stabilizes both multimer formation and DNA binding. A high degree of conservation at both the amino acid and nucleotide levels between the human transcription factor TFE3 and mTFE3 suggests that mTFE3 is the murine homolog of human TFE3. By using fluorescent in situ hybridization, mTFE3 was mapped to mouse chromosome X in band A2, which is just below the centromere. We show that in addition to the immunoglobulin heavy-chain μE3 site, mTFE3 binds to transcriptional elements important for lymphoid-specific, muscle-specific, and ubiquitously expressed genes. Binding of mTFE3 to DNA induces DNA bending.