Binding sites for the transcription factor Rap1 are widespread in the yeast genome. With respect to many, but not all, genes, Rap1p has an apparent activation function. Whether Rap1 is itself a transcriptional activator, or whether it is in some way required for activation by additional factors, is not clear. We have identified a previously unrecognized Rap1p binding site in the internal regulatory region of Ty1 elements. We demonstrate that this site is capable of binding Rap1 in vitro and that, in vivo, Rap1p plays an important regulatory role in Ty1 and Ty1-mediated adjacent gene expression. Our data suggest that in Ty1 elements, maximal levels of RAP1-mediated activation depend on the formation of a complex with Mcm1, an independent DNA-binding protein that functions in transcription as well as in DNA replication, and with a third factor, IBF, previously identified as a binding activity with a site situated between the Rap1p and Mcm1p binding sites in this region of Ty1 elements.