Neurogenin3 (ngn3) is a transcription factor that is essential for the differentiation of pancreatic endocrine cells. To investigate the signaling pathway that regulates ngn3 expression, we used AR42J-B13 cells as a model of the differentiation of pancreatic islets. In these cells, treatment with activin A and hepatocyte growth factor (HGF) induced the expression of ngn3. Reporter gene analysis using human ngn3 gene (NEUROG3) promoter fragments of various lengths identified the region between -402 and -327 bp of NEUROG3 as an activin A- and HGF-responsive DNA sequence. This DNA sequence normally functions as a repressor in AR42J-B13 cells, but treatment with activin A and HGF negates the repressor activity. Interestingly, function of the activin A- and HGF-responsive sequence was not influenced by the overexpression of the Smad inhibitory factor, Smad7. Instead, activin A and HGF activation was inhibited by overexpression of a dominant-negative mutant of transforming growth factor-beta-activated kinase 1 (TAK1), or mitogen-activated protein kinase kinase 3 (MKK3), or by treatment with a p38 MAPK-specific inhibitor, SB203580. Activin A and HGF function through the TAK1-MKK3-p38 MAPK pathway to relieve transcription repressors located between -402 and -326 bp on the NEUROG3 promoter, and consequently activate ngn3 expression and endocrine differentiation of AR42J-B13 cells.