The proprotein convertase furin participates in the maturation/bioactivation of a variety of proproteins involved in chondrogenesis events. These include parathyroid hormone-related peptide (PTHrP), an autocrine/paracrine factor that is crucial to both normal cartilage development and cartilage-related pathological processes. Despite the known importance of furin activity in the bioactivation of the polypeptides, the mechanisms that control furin regulation in chondrogenesis remain unknown. To gain insight into the molecular regulation of furin, we used the mouse prechondrogenic ATDC5 cell line, an established in vitro model of cartilage differentiation. Peak expression of both furin mRNA and furin PTHrP maturation was observed during chondrocyte nodule formation stage, an event that correlated with increased mRNA levels of Sox9, a potent high-mobility-group (HMG) box-containing transcription factor required for cartilage formation. Inhibition of furin activity led to a diminution in maturation of PTHrP, suggesting a relationship between Sox9-induced regulation of furin and chondrogenesis events. Transient transfection of Sox9 in nonchondrogenic cells resulted in a marked increase in furin mRNA and in the transactivation of the furin P1A promoter. Direct Sox9 action on the P1A promoter was narrowed down to a critical paired site with Sox9 binding capability in vitro and in vivo. Sox9 transactivation effect was inhibited by L-Sox5 and Sox-6, two Sox9 homologs also expressed in ATDC5 cells. Sox6 inhibitory effect was reduced when using Sox6-HMG-box mutants, indicating a repressive effect through direct HMG-box/DNA binding. Our work suggests a mechanism by which furin is regulated during chondrogenesis. It also adds to the complexity of Sox molecule interaction during gene regulation.