The liver is one of the few adult tissues that has the capacity to regenerate following hepatectomy or toxic damage. In examining the early growth response during hepatic regeneration, we found that a highly induced immediate-early gene in regenerating liver encodes RL/IF-1 (regenerating liver inhibitory factor) and is the rat homolog of human MAD-3 and probably of chicken pp40. RL/IF-1 has I kappa B activity of broad specificity in that it inhibits the binding of p50-p65 NF-kappa B, c-Rel-p50, and RelB-p50, but not p50 homodimeric NF-kappa B, to kappa B sites. Like RL/IF-1, several members of the NF-kappa B and rel family of transcription factors are immediate-early genes in regenerating liver and mitogen-treated cells. We examined changes in kappa B site binding activity during liver regeneration and discovered a rapidly induced novel kappa B site-binding complex designated PHF [posthepatectomy factor(s)]. PHF is induced over 1,000-fold within minutes posthepatectomy in a protein synthesis-independent manner, with peak activity at 30 min, and is not induced by sham operation. PHF is distinct from p50-p65 NF-kappa B, which is present only in the inactive form in liver posthepatectomy. Although early PHF complexes do not interact strongly with anti-p50 antibodies, PHF complexes present later (3 to 5 h) posthepatectomy react strongly, suggesting that they contain a p50 NF-kappa B subunit. Unlike p50-p65 NF-kappa B, c-Rel-p50, and RelB-p50 complexes, PHF binding to kappa B sites is not inhibited by RL/IF-1. One role of RL/IF-1 in liver regeneration may be to inhibit p50-p65 NF-kappa B activity present in hepatic cells, allowing for the preferential binding of PHF to kappa B sites. Because PHF is induced immediately posthepatectomy in the absence of de novo protein synthesis, PHF could have a role in the regulation of liver-specific immediate-early genes in regenerating liver.