The aryl hydrocarbon receptor (AhR) mediates the toxicity of 2,3,7, 8-tetrachlorodibenzo-p-dioxin (TCDD) and related compounds in vertebrates. To further establish zebrafish as a vertebrate model to study the molecular mechanism of TCDD toxicity, we have isolated and characterized the cDNA encoding the zebrafish aryl hydrocarbon receptor (zfAhR2). Analysis of the deduced protein sequence revealed the 1027 amino acid protein is approximately 200 amino acids longer than previously isolated receptors. zfAhR2 is homologous to previously cloned PAS proteins within the basic helix-loop-helix and PAS domains. The C-terminal domain of zfAhR2 diverges from the mammalian AhR at position 420, and does not contain a Q-rich domain. zfAhR2 mRNA is first detected by Northern blot analysis at 24 h post fertilization, and expression increases throughout early development. Treatment of zebrafish embryos and zebrafish liver cells with graded doses of TCDD results in a dose-dependent increase in zfAhR2 mRNA. The time course for zfAhR2 and cytochrome P4501A mRNA induction by TCDD are similar. In vitro produced zfAhR2 protein dimerizes with the rainbow trout aryl hydrocarbon receptor nuclear translocator (rtARNTb) and binds dioxin response elements derived from the rainbow trout CYP1A gene. Finally, transient coexpression of zfAhR2 and rtARNTb in COS-7 cells results in a TCDD dose-related increase in transcription driven by the rainbow trout CYP1A promoter and enhancer.