Restriction of glutamine synthetase to the nervous system is mainly achieved through the mutual function of the glucocorticoid receptor and the neural restrictive silencing factor, NRSF/REST. Glucocorticoids induce glutamine synthetase expression in neural tissues while NRSF/REST represses the hormonal response in non-neural cells. NRSF/REST is a modular protein that contains two independent repression domains, at the N and C termini of the molecule, and is dominantly expressed in nonneural cells. Neural tissues express however splice variants, REST4/5, which contain the repression domain at the N, but not at the C terminus of the molecule. Here we show that full-length NRSF/REST or its C-terminal domain can inhibit almost completely the induction of gene transcription by glucocorticoids. By contrast, the N-terminal domain not only fails to repress the hormonal response but rather stimulates it markedly. The inductive activity of the N-terminal domain is mediated by hBrm, which is recruited to the promoter only in the concomitant presence of GR. Importantly, a similar inductive activity is also exerted by the splice variant REST4. These findings raise the possibility that NRSF/REST exhibits a dual role in regulation of glutamine synthetase. It represses gene induction in nonneural cells and enhances the hormonal response, via its splice variant, in the nervous system.