A group of transcriptional cofactors for nuclear hormone receptors, referred to as corepressors (CoRs) and coactivators (CoAs), has been shown to induce transcriptional silencing and hormone-induced activation, respectively, of genes that contain positive hormone response elements. Transcriptional silencing by CoRs involves the recruitment of histone deacetylases (HDACs), whereas ligand-dependent activation is associated with the recruitment of CoAs, which possess or recruit histone acetyltransferases (HATs), In a reciprocal manner, negatively regulated genes are stimulated by nuclear receptors in the absence of ligand and are repressed in response to ligand binding to receptors, We show here that negative regulation of the thyroid-stimulating hormone alpha (TSH alpha) promoter by the thyroid hormone receptor (TR) involves a novel mechanism in which the recruitment of CoRs by TR is associated with transcriptional stimulation and histone acetylation. Expression of excess HDAC reverses the stimulation mediated by the TR CoR complex, consistent with a pivotal role for acetylation in this event. Addition of the ligand, 3,5,3'-triiodothyronine (T3), induces transcriptional repression of the TSH alpha promoter and is associated with the loss of histone acetylation, T3-dependent repression is blocked by phosphorylation of cAMP response element binding protein, or by inhibition of HDAC, indicating that receptor action is subverted by maneuvers that stimulate histone acetylation of the target gene. We propose that negative regulation of a subset of genes by TR involves the active exchange of CoRs and CoAs with intrinsic promoter regulatory elements that normally strongly induce histone acetylation and transcriptional activation.