Fatty acids induce an increase in the transcription of the mitochondrial 3-hydroxy-3-methylglutaryl-CoA (HMG-CoA) synthase gene, which encodes an enzyme that has been proposed as a control site of ketogenesis. We studied whether the peroxisome proliferator-activated receptor (PPAR) is involved in the mechanism of this transcriptional induction. We found that cotransfection of a rat mitochondrial HMG-CoA synthase promoter- chloramphenicol acetyltransferase reporter plasmid and a PPAR expression plasmid in the presence of the peroxisome proliferator clofibrate led to a more than 30-fold increase in chloramphenicol acetyltransferase activity, relative to the activity in the absence of both PPAR and inducer. Linoleic acid, a polyunsaturated fatty acid, increased this activity as potently as does clofibrate and more effectively than does monounsaturated oleic acid. We have identified, by deletional analysis, an element located 104 base pairs upstream of the mitochondrial HMG-CoA synthase gene, which confers PPAR responsiveness to homologous and heterologous promoters. This is the first example of a peroxisome proliferator-responsive element (PPRE)in a gene encoding a mitochondrial protein. This element contains an imperfect direct repeat that is similar to those described in theP PREs of other genes. Furthermore, gel retardation and cotransfection assays revealed that, as for other genes, PPAR heterodimerizes with retinoid X receptor and that both receptors cooperate for binding to the mitochondrial HMG-CoA synthase PPRE and subsequent activation of the gene. In conclusion, our data demonstrate that regulation of mitochondrial HMG-CoA synthase gene expression by fatty acids is mediated by PPAR, supporting the hypothesis that PPAR has an important role at the transcriptional level in the regulation of lipid metabolism.