The early growth response 1 (Egr-1) gene product is a transcription factor that functions as an oikis factor. Loss of Egr-1 expression is closely associated with tumor formation. Phospholipase Cγ1 (PLCγ1) is overexpressed in some tumors, and its overexpression causes anchorage-independent growth. Here we report that overexpression of PLCγ1 and SH2-SH3 domain of PLCγ1 decreased induction of Egr-1 and the Egr-1-regulated genes TSP-1 and PAI-1. Results from the nuclear run-on assay and transfection experiment with the proximal 455 base pair region of the Egr-1 promoter (-454 to +1) showed that Egr-1 transcriptional activity was suppressed in PLCγ1-3Y1 cells whereas decay of Egr-1 mRNA was similar in both cell lines. Serum response element- and ternary complex factor Elk-1-mediated transcriptional activation of the reporter gene in response to EGF were also inhibited in PLCγ1-3Y1 cells. Pretreatment with the protein synthesis inhibitor cycloheximide (CHX) partially abrogated the serum-induced suppression of Egr-1 transcription in PLCγ1-3Y1 cells, suggesting that a CHX-sensitive factor(s) is involved in the suppression of Egr-1 transcription in PLCγ1-3Y1 cells. Our results demonstrated that overexpression of PLCγ1 functions as a negative modulator of the tumor suppressor Egr-1 gene expression, possibly through inhibition of Elk-1-dependent transcriptional activity.