We have cloned and sequenced the SIN4 gene and determined that SIN4 is identical to TSF3, identified as a negative regulator of GAL1 gene transcription (S. Chen, R. W. West, Jr., S. L. Johnson, H. Gans, and J. Ma, submitted for publication). Yeast strains bearing a sin4DELTA null mutation have been constructed and are temperature sensitive for growth and display defects in both negative and positive regulation of transcription. Transcription of the CTS1 gene is reduced in sin4DELTA mutants, suggesting that Sin4 functions as a positive transcriptional regulator. Additionally, a Sin4-LexA fusion protein activates transcription from test promoters containing LexA binding sites. The sin4DELTA mutant also shows phenotypes common to histone and spt mutants, including suppression of delta insertion mutations in the HIS4 and LYS2 promoters, expression of promoters lacking upstream activation sequence elements, and decreased superhelical density of circular DNA molecules. These results suggest that the sin4DELTA mutation may alter the structure of chromatin, and these changes in chromatin structure may affect transcriptional regulation.