The mouse orphan nuclear receptor TR2-11 functions as a repressor for reporter genes containing a direct repeat-5 or direct repeat-4 hormone response element. The functional domains responsible for its suppressive activity are defined, including the DNA-binding domain and the ligand- binding domain. The C-terminal 30 amino acid residues can be deleted without compromising its suppressive activity, whereas a deletion for 40 amino acids completely abolishes the suppressive activity and receptor dimerization, and reduces the DNA-binding affinity. Point mutation at three conserved leucine residues located on the predicted dimer interface abolishes the suppressive activity, receptor dimerization and its DNA binding property. However, mutation at two consecutive glutamate residues located within the hinge between the last two helices of the ligand-binding domain (helix 10 and helix 11 according to the human retinoid receptor X α structure) drastically reduces its DNA-binding affinity and abrogates the suppressive activity without compromising its ability to dimerize, indicating that receptor dimerization property can be functionally uncoupled from its suppressive activity. A transferable, active silencing activity is encoded within the DEF segment of the receptor molecule, as evidenced by the suppression of a GAL4 reporter by a chimeric protein containing the DNA-binding domain of GAL4 and the DEF segment of TR2-11. Moreover, the C-terminal 49 amino acid sequence is required for this trans-suppressive activity. It is suggested that TR2-11 functions as a repressor, mediated by mechanisms requiring high affinity DNA binding, receptor dimerization, and active silencing.