LH receptor gene expression is primarily regulated via specific interactions of trans-acting proteins and cis-acting DNA sequences in the upstream region of the gene. In this study, we report, using luciferase assays, that the region between −171 and −137 base pairs (bp) is essential for basal expression of the rat LH receptor gene. To identify factors that interact with the region between −171 and −137 bp and regulate expression of the gene, a rat granulosa cell cDNA library was screened using a yeast one-hybrid system. A positive clone, isolated by the screening, encodes a transcription factor early growth response gene-1 (Egr-1). To determine the sequence to which Egr-1 protein binds, electrophoretic mobility shift assay (EMSA) was employed. The Egr-1 protein was produced by an in vitro transcription/translation system using a full-length rat Egr-1 cDNA. The upstream region between −171 and −137 bp contains 2 overlapping Egr-1 consensus sequences. The EMSA revealed that Egr-1 binds independently to both sites. The overexpression of Egr-1 in MA-10 cells caused an approximately 2-fold increase in reporter luciferase activity. However, no induction of the luciferase activity was observed when luciferase constructs that lacked or had mutations in either or both of the Egr-1 sites were used, indicating that Egr-1 positively regulates LH receptor gene expression. In differentiated granulosa cells that had been pretreated with FSH for 48 h, the levels of both mRNA and Egr-1 protein were induced by hCG or cAMP, reaching maximal levels approximately 1.5 h after treatment and then returning to basal levels 8 h thereafter. No Egr-1 mRNA or protein was detected in undifferentiated granulosa cells, even after stimulation with 8-bromoadenosine-cAMP. These results suggest that Egr-1 functions only in luteinized granulosa cells after stimulation with hCG or cAMP. In conclusion, the findings demonstrate that Egr-1 actually binds to the regulatory upstream region of the LH receptor gene and positively regulates receptor gene expression. In addition, Egr-1 expression was observed only in luteinized granulosa cells after stimulation with hCG or cAMP. The present study provides further support to the hypothesis that Egr-1 plays important roles in the pituitary-gonadal axis.