The use of synthetic chemical moieties to design fully functional analogues of transcription factors will give rise to novel molecular tools for targeted gene regulation. Here we demonstrate that a synthetic molecule based on a nonpeptidic DNA-binding domain can be engineered to function as a highly potent transcription factor in vitro and in an intracellular context. The structure of this artificial transcription factor (ATF) consists of three parts: (i) triple-helix-forming oligonucleotide as a DNA-binding domain; (ii) composite linker moiety; and (iii) short synthetic peptide. The direct comparison of ATFs with natural transcription factors in in vitro assays reveals the ability of ATFs to initiate RNA transcription at the correct initiation site. In addition, the transcriptional activation potency of ATFs in vitro matches or exceeds the potency of GAL4-VP16, one of the strongest natural transcriptional activators. This remarkable biological activity is explained as a function of ATF's chemical structure. We also demonstrate for the first time that ATFs possess substantial ability to activate transcription in tissue culture cells, thus opening a prospect for practical applications in basic and applied research. The specific molecular design employed in the synthesis of ATFs may lead to the development of novel gene-targeting pharmaceuticals for treatment of fatal and chronic diseases.