Abnormal regulation of the IL-2 promoter in lpr CD4-CD8- T lymphocytes results in constitutive expression of a novel nuclear factor of activated T cells-binding factor. The inert quality of MRL-Ipr/Ipr (Ipr) peripheral CD4-CD8- (CD4-8-) T cells manifests primarily as an inability to proliferate or produce IL-2 in response to TCR or mitogenic stimulation. Yet these same cells do initiate early TCR-mediated signaling events, such as generation of inositol phosphates and increased intracellular calcium. They also display constitutively high levels of p59fyn and CD3 zeta tyrosine phosphorylation. The generation of second messengers in T cells normally leads to downstream signaling that results in transcriptional activation of the IL-2 gene. We, therefore, compared the activation state of the IL-2 gene promoter region in freshly isolated and stimulated Ipr CD4-8- T cells with that of normal T lymphocytes. Levels of the octamer, NF-kappa B (p50-p65 heterodimer), and AP-1 transcriptional factors are constitutively elevated in freshly isolated Ipr CD4-8- T cells, consistent with the activated phenotype of these cells. Upon stimulation with mitogens, formation of the transactivating complex, nuclear factor of activated T cells (NF-AT), occurs with normal kinetics in Ipr CD4-8- T cells. Yet, the levels of the activating NF-AT complex never reach those observed in similarly stimulated normal T cells. Furthermore, nuclear extracts from Ipr CD4-8- T cells display high levels of a novel specific binding activity at the NF-AT site, which is present at much lower levels in freshly isolated normal T lymphocytes. Upon mitogenic stimulation, the binding activity of the novel NF-AT-binding factor is rapidly down-regulated in normal T cells, but persists at high levels in Ipr CD4-8- T cells. These two abnormalities at the NF-AT site provide a potential mechanism to account for the defect in IL-2 production from Ipr CD4-8- T cells.