We have isolated and characterized two novel cDNAs encoding C2H2 zinc finger proteins showing high sequence homology to PLAG1, a protein ectopically activated by promoter swapping or promoter substitution in pleomorphic adenomas with chromosomal abnormalities at chromosome 8q12. PLAG1 and the two new PLAG1 family members (PLAGL1 and PLAGL2) constitute a novel subfamily of zinc finger proteins that recognize DNA and/or RNA. To examine the potential of the three human proteins to modulate transcription, we constructed several PLAG/GAL4 DNA binding domain fusion proteins and measured their ability to activate transcription of a reporter gene construct in different mammalian cell lines and in yeast. Although the carboxyl-terminal part of PLAGL1 shows strong overall transcriptional activity in mesenchymal (COS-1) and epithelial cells (293), both PLAG1 and PLAGL2 transactivate in mesenchymal cells only if depleted from a repressing region. This effect is less profound in epithelial cells. These data suggest that the activation in pleomorphic adenomas of PLAG1 most likely results in uncontrolled activation of downstream target genes.