Transcription of the human erythropoietin (Epo) gene is stimulated by exposure to hypoxia and/or cobalt in whole animals and in Hep3B cells. We have systematically investigated the promoter and 3′ enhancer elements necessary for this induction by transient transfection of Hep3B cells. We define a promoter region of 53 bp and an enhancer region of 43 bp that confer hypoxia and cobalt inducibility. Each element gives rise to a 6- to 10-fold induction alone. In combination they produce a 50-fold induction after stimulation, similar to the 50- to 100-fold induction of the endogenous Epo gene. Two areas of DNA sequence homology are present in these regions. We demonstrate specific DNA-protein interactions in the enhancer and the ability of the promoter element to compete with these interactions in electrophoretic mobility shift assays. DNase I footprinting and methylation interference data further refine the cis-acting element in the 43-bp enhancer to a short region containing a direct repeat of a steroid/thyroid hormone receptor response element half-site separated by a 2-bp gap. Two half-site consensus sequences are also present in the 53-bp promoter. Site-specific mutation of the half-site sequences in the enhancer destroys the functional activity of the enhancer.