Collagenase, the only enzyme active at neutral pH that initiates collagen degradation, is a major gene product of fibroblasts that have been stimulated with a variety of agents, including phorbol esters. To study mechanisms controlling collagenase gene expression, we transiently transfected rabbit synovial fibroblasts with chimeric constructs containing up to 1.2 kb of the rabbit collagenase 5'-flanking DNA linked to the chloramphenicol acetyltransferase gene (CAT). Our data indicate that the magnitude of the phorbol response is directly linked to the size of the promoter fragment and that the smallest piece of promoter DNA conferring phorbol inducibility is 127 bp. Deletional and mutational analysis of this fragment revealed that the AP-1 sequence alone is insufficient for phorbol inducibility and the presence of at least two additional sequences (a PEA3-like element and a sequence that includes 5'-TTCA-3') is required. In addition, a substantial increase in responsiveness is seen when a fragment containing 182 bp of 5'-flanking DNA is transfected, implicating a 36 bp region located between -182 and -149 as an enhancer. We conclude (1) that the AP-1 sequence is necessary but insufficient for expression of collagenase in adult fibroblasts, (2) that phorbol inducibility depends on cooperation among several sequence elements within the collagenase promoter, and (3) that regulation of this promoter is more complex than previously described.