The transcription factor hGABP/E4TF1 is a heterotetrameric complex composed of two DNA-binding subunits (hGABP alpha/E4TF1-60) and two transactivating subunits (hGABP beta/E4TF1-53). In order to understand the molecular mechanism of transcriptional regulation by hGABP, we searched for proteins that interact with the non-DNA-binding subunit, hGABP beta, using yeast two-hybrid screening. We identified a human cDNA encoding a protein related to YAF-2 (YY1-associated factor 2), which was previously isolated as an interacting partner of the Ying-Yang-1 (YY1) transcription factor. Reflecting this similarity, both YAF-2 and this novel protein (named YEAF1 for YY1- and E4TF1/hGABP-associated factor-1) interacted with hGABP beta and YY1 in vitro and in vivo, indicating that YEAF1 and YAF-2 constitute a cofactor family for these two structurally distinct transcription factors. By using yeast three-hybrid assay, we demonstrated that hGABP beta and YY1 formed a complex only in the presence of YEAF1, indicating that YEAF1 is a bridging factor of these two transcription factors. These cofactors are functionally different in that YAF-2 positively regulates the transcriptional activity of hGABP but YEAF1 negatively regulates this activity. Also, YAF-2 mRNA is highly expressed in skeletal muscle, whereas YEAF1 mRNA is highly expressed in placenta. We speculate that the transcriptional activity of hGABP is in part regulated by the expression levels of these tissue-specific cofactors. These results provide a novel mechanism of transcriptional regulation by functionally distinct cofactor family members.