Vascular endothelial growth factor (VEGF) plays an important role in the pathogenesis of arthritis by promoting angiogenesis in the synovial joint and infiltration of inflammatory cells in the synovial joint. Although ample information has been obtained on the mechanism of VEGF regulation during cancer and hypoxic condition, less is known about the control of VEGF expression during arthritis. From the studies on the experimentally induced arthritis in a transgenic mouse model that overexpresses a transcription factor, serum amyloid A activating factor-1 (SAF-1), leading to markedly higher levels of angiogenesis, synovial inflammation, and inflammatory cell infiltration, we have identified a novel mechanism of VEGF regulation. We present molecular evidence that VEGF expression is increased in SAF-1-transgenic mice and that SAF-1 induces VEGF transcription by directly binding to its promoter. Deletion of SAF-1 binding elements from the VEGF promoter as well as knockdown of endogenous SAF-1 markedly inhibited IL-1beta- and TGF-beta-mediated induction of VEGF expression in chondrocyte cells. By chromatin immunoprecipitation assay, in vivo, markedly higher levels of SAF-1 interaction with the VEGF promoter was detected in the cartilage tissues of arthritic mice as well as human osteoarthritic patients. Together, these results provide a new insight into the molecular mechanism of VEGF expression.