The GLI oncogene, discovered by virtue of its amplification in human tumors, encodes a sequence-specific DNA-binding protein containing five zinc fingers. We have now characterized one member of a family of GLI-related zinc finger genes. A previously identified fragment of GLI3 genomic DNA was used to localize GLI3 to chromosome 7p13 and to isolate cDNA clones. Sequence analysis of these clones and identification of the GLI3 protein by using polyclonal antisera demonstrated that GLI3 encodes a protein of 1,596 amino acids and an apparent molecular mass of 190 kilodaltons. Amino acid sequence comparison with GLI demonstrated seven regions of similarity (53 to 88% identity), with the zinc fingers representing the most similar region. Furthermore, when produced in vitro, the GLI3 protein bound specifically to genomic DNA fragments containing GLI-binding sites. Amino acid sequence comparison with the product of another member of the GLI family, the Drosophila segment polarity gene cubitus interruptus Dominant, revealed additional similarity that was not shared with GLI. These studies suggest that the GLI-related genes encode a family of DNA-binding proteins with related target sequence specificities. In addition, sequence similarity aside from the zinc finger region suggests that other aspects of function are shared among the members of this gene family.