Integrating cell cycle progression with transcription provides an important level of control during proliferation. The cellular transcription factor DRTF1/E2F is implicated in this integration process by virtue of its physical interaction and control by key regulators of proliferation, such as retinoblastoma protein, cyclins and cyclin-dependent kinases and regulation of target genes required for cell cycle progression. Generic DRTF1/E2F DNA binding activity arises when a member of two distinct families of proteins, DP and E2F, interact as DP/E2F heterodimers. Here, we report the isolation and characterisation of a new member of the murine DP family, called DP-3 (also referred to as human DP-2). In contrast to previously characterised members of the DP and E2F families, processing of DP-3 RNA provides an important level of control by generating at least four distinct DP-3 proteins, of which three have been isolated, called alpha, beta and gamma. Processing events, which we show are both tissue- and cell-restricted, can occur either in the 5' region of DP-3 RNA and determine whether translation begins at one or two potential intiating codons, or within the coding sequence, producing variations in internal domains of the DP-3 proteins. The DP-3 proteins studied can co-operate with E2F-1 in DNA binding activity and trans activation of E2F site-dependent transcription. This analysis of DP-3, which has uncovered a hitherto unexpected and surprising level of complexity, documents a new member of the DP family and novel levels of control which may influence the activity DRTF1/E2F and hence cell cycle progression.