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Molecular interaction between transcription factors containing an basic-helix-loop-helix (bHLH) domain is known to regulate differentiation in several cellular systems including myogenesis, neurogenesis and haematopoiesis. DNA-binding activity of the bHLH proteins is mediated via the basic region and is dependent upon formation of homo- and/or heterodimers of these transcription factors. Dominant negative (dn) HLH proteins (Id1, Id2, Id3 and emc) also contain the HLH-dimerization domain but lack the DNA-binding basic region. Formation of heterodimers between dnHLH and bHLH proteins abolishes the DNA-binding activity of the latter. Concordantly, it was shown that the dnHLH protein Id1 inhibits differentiation of muscle and myeloid cells in vitro. Therefore, it was postulated that dnHLH proteins serve as general antagonists of cell differentiation. We have isolated and characterized a novel mouse dnHLH gene, designated Id4. The Id4 protein contains a HLH domain highly conserved among the dnHLH proteins from mouse and drosophila. Outside of the HLH domain, three additional short regions of the dnHLH proteins show some degree of homology. DNA-binding of E47 homo- as well as E47/MyoD heterodimers is inhibited by Id4. Transcription of the Id4 gene results in three RNA molecules of 3.7, 2.0 and 1.7 kb which are presumably a result of differential splicing and/or alternatively used polyadenylation sites within the 3' untranslated region. During embryogenesis, Id4 expression is up-regulated between day 9.5 and 13.5 of gestation. The highest expression in adult tissues was detected in testis, brain and kidney. Comparison of the expression patterns of the four mouse dnHLH genes revealed that Id4 expression differs from the more restricted expression of Id2 as well as from the widespread expression of Id1 and Id3.