Pax5 (paired box binding factor 5) is a critical regulator of transcription and lineage commitment in B lymphocytes. In B cells, mb-1 (Ig-alpha/immunoglobulin-associated alpha) promoter transcription is activated by Pax5 through its recruitment of E74-like transforming sequence (Ets) family proteins to a composite site, the P5-EBS (Pax5-Ets binding site). Previously, X-ray crystallographic analysis revealed a network of contacts between the DNA-binding domains of Pax5 and Ets-1 while bound to the P5-EBS. Here, we report that Pax5 assembles these ternary complexes via highly cooperative interactions that overcome the autoinhibition of Ets-1. Using recombinant proteins, we calculated K(d(app)) values for the binding of Pax5, Ets-1, and GA-binding proteins, separately or together, to the P5-EBS. By itself, Pax5 binds the P5-EBS with high affinity (K(d) approximately equal 2 nM). Ets-1(331-440) bound the P5-EBS by itself with low affinity (K(d)=136 nM). However, autoinhibited Ets-1(280-440) alone does not bind detectably to the suboptimal sequences of the P5-EBS. Recruitment of Ets-1(331-440) or Ets-1(280-440) resulted in highly efficient ternary complex assembly with Pax5. Pax5 counteracts autoinhibition and increases binding of Ets-1 of the mb-1 promoter by >1000-fold. Mutation of Pax5 Gln22 to alanine (Q22A) enhances promoter binding by Pax5; however, Q22A greatly reduces recruitment of Ets-1(331-440) and Ets-1(280-440) by Pax5 (8.9- or >300-fold, respectively). Thus, Gln22 of Pax5 is essential for overcoming Ets-1 autoinhibition. Pax5 wild type and Q22A each recruited GA-binding protein alpha/beta1 to the mb-1 promoter with similar affinities, but recruitment was less efficient than that of Ets-1 (reduced by approximately 8-fold). Our results suggest a mechanism that allows Pax5 to overcome autoinhibition of Ets-1 DNA binding. In summary, these data illustrate requirements for partnerships between Ets proteins and Pax5.