Introduction of a retroviral expression vector for the aryl hydrocarbon receptor (AHR) restores CYP1A1 inducibility to a mutant derivative of the Hepa-1 cell line that is defective in induction of CYP1A1 by ligands for the receptor. An AHR protein with normal ligand binding activity is expressed in the mutant but ligand treatment of mutant cell extract fails to induce binding of the AHR. ARNT (aryl hydrocarbon receptor nuclear translocator) dimer to the xenobiotic responsive element (XRE). AHR cDNAs derived from the mutant encode a protein that is unimpaired in ligand-dependent dimerization with ARNT, but the AHR.ARNT dimer so formed is severely impaired in XRE binding activity. The mutant cDNAs contain a C to G mutation at base 648, causing a cysteine to tryptophan alteration at amino acid 216, located between the PER-ARNT-SIM homology region (PAS) A and PAS B repeats. Introduction of the same mutation in the wild-type AHR sequence by site-directed mutagenesis similarity impaired XRE binding activity. Substitution with the conservative amino acid, serine, had no effect on XRE binding. The tryptophan mutation, but not the wild-type allele, was detectable in genomic DNA of the mutant. The implication that an amino acid within the PAS region may be involved in DNA binding indicates that the DNA binding behavior of AHR may be more anomalous than previously suspected.