Interleukin-1 beta (IL-1beta) is a central mediator of inflammation and connective tissue destruction in rheumatoid arthritis. IL-1beta activates articular chondrocytes to produce matrix metalloproteinase-1 (MMP-1), an enzyme capable of dismantling the collagen scaffold of articular cartilage. To define the transcription factors and signaling intermediates that activate MMP-1 transcription in chondrocytes, we performed transient transfection of MMP-1 promoter constructs followed by reporter assays. These studies identified an IL-1beta-responsive region of the human MMP-1 promoter that contains a consensus CCAAT enhancer-binding protein (C/EBP) binding site. Deletion of this site reduced overall transcriptional activity of the MMP-1 promoter, as well as decreased fold induction by IL-1beta. IL-1beta stimulation of chondrocytes increased binding of C/EBP-beta to the MMP-1 C/EBP site. Extracellular signal regulated kinase (ERK) pathway-dependent phosphorylation of C/EBP-beta on threonine 235 activates this transcription factor. Here we show that IL-1beta stimulation of chondrocytes induced phosphorylation of C/EBP-beta on threonine 235, and that the ERK pathway inhibitor PD98059 reduced this phosphorylation. We further show that PD98059 reduces IL-1beta-induced MMP-1 mRNA expression in chondrocytes. Moreover, inhibition of the ERK pathway by expression of dominant-negative forms of ERK1 and ERK2 impaired the ability of IL-1beta to transactivate the MMP-1 promoter. Our findings demonstrate a novel role for C/EBP-beta in IL-1beta-induced connective tissue disease and define a new nuclear target for the ERK pathway in MMP-1 gene activation.