Hypoxia induces a group of physiologically important genes such as erythropoietin and vascular endothelial growth factor. These genes are transcriptionally up-regulated by hypoxia-inducible factor 1 (HIF-1), a global regulator that belongs to the basic helix-loop-helix PAS family. Although HIF-1 is a heterodimer composed of α and β subunits, its activity is primarily determined by hypoxia-induced stabilization of HIF-1α, which is otherwise rapidly degraded in oxygenated cells. We report the identification of an oxygen-dependent degradation (ODD) domain within HIF-1α that controls its degradation by the ubiquitin-proteasome pathway. The ODD domain consists of ≈200 amino acid residues, located in the central region of HIF-1α. Because portions of the domain independently confer degradation of HIF-1α, deletion of this entire region is required to give rise to a stable HIF-1α, capable of heterodimerization, DNA-binding, and transactivation in the absence of hypoxic signaling. Conversely, the ODD domain alone confers oxygen-dependent instability when fused to a stable protein, Gal4. Hence, the ODD domain plays a pivotal role for regulating HIF-1 activity and thereby may provide a means of controlling gene expression by changes in oxygen tension.