Testis-specific H2B (TH2B) histone gene of rat is expressed during meiotic event of spermatogenic differentiation. The gene is unusual in that it has conserved the regulatory elements involved in the S phase-specific transcription of somatic H2B genes as well as the S phase-specific stabilization of histone mRNA. Genomic sequencing revealed that all analyzed CpG sites in the promoter region of TH2B gene are methylated in somatic tissues but not in testis. During spermatogenesis, these CpG sites are unmethylated as early as spermatogonia type A and up to sperm. Thus, there is a good correlation between DNA hypomethylation and germ cell-specific expression of TH2B gene. Results obtained from in vivo DNase footprinting and DNA mobility shift experiments are consistent with the hypothesis that DNA methylation inhibits gene activity by preventing the binding of transcription factors to their recognition sequences. The results show that (i) the binding of ubiquitous transcription factors to the promoter region of TH2B gene may be blocked in nuclei of liver, and (ii) DNA methylation can directly interfere with the binding of transcription factors recognizing a hexamer (ACGTCA) motif. In vitro DNA methylation and transfection experiments demonstrated that expression of TH2B gene is inhibited by DNA methylation in vivo. These findings indicate that DNA methylation may play a key role in the transcriptional repression of germ cell-specific TH2B gene.