The cAMP-responsive element (CRE)-binding transcription factor CREB confers basal as well as cAMP- and calcium-induced transcription. Activation of CREB occurs by phosphorylation on serine-119 stimulating its transactivating potency. However, the regulation of CREB-DNA binding by posttranslational modification is not established. In this study, using binding and functional assays, the interaction of CREB with pancreatic islet cell-specific enhancer elements of the rat somatostatin (SMS-UE), glucagon (Glu-G3) and insulin I genes (Ins-E1) was investigated, which share a functional regulatory sequence, PISCES, with islet-specific activity. CREB bound to the SMS-UE. Bacterially expressed recombinant CREB bound equally well to the SMS-UE and to the somatostatin CRE. However, cellular CRE-binding proteins with CREB-like immunoreactivity recognized the SMS-UE markedly less well than the somatostatin CRE suggesting the existence of a posttranslational modification of CREB that alters its binding specificity.