Expression of the pulmonary surfactant protein-A (SP-A) gene is lung-specific, developmentally regulated and enhanced by hormones and factors that increase cAMP. We previously identified two E-box-like enhancers termed DBE and PBE, in the 5'-flanking region of the rabbit (r)SP-A gene that are essential for cAMP induction of rSP-A promoter activity. We also found that DBE and PBE serve as binding sites for the basic helix-loop-helix-leucine zipper (bHLH-LZ) transcription factor, upstream stimulatory factor 1 (USF1). In the present study, PBE was used to screen a rabbit fetal lung cDNA expression library; a cDNA insert encoding the structurally related rUSF2 was isolated. The levels of rUSF2 mRNA reach peak levels in fetal rabbit lung at 28-days gestation, in concert with the time of maximal induction of SP-A gene transcription. In yeast two-hybrid analysis, rUSF2 was found to preferentially form heterodimers, as compared to homodimers, with rUSF1. Binding complexes of nuclear proteins isolated from fetal rabbit lung type II cells with the DBE and PBE were supershifted by anti-rUSF2 antibodies. Binding activity was enriched in nuclear proteins from type II cells as compared to fibroblasts. Overexpression of rUSF2 in transfected lung A549 cells increased rSP-A promoter activity and acted synergistically with rUSF1. We suggest that heterodimers of USF2 and USF1 bound to two E-box elements in the SP-A gene 5'-flanking region serve a key role in developmental and hormonal regulation of SP-A gene expression in pulmonary type II cells.