The polyomavirus JC (JCV) causes the demyelinating disease progressive multifocal leukoencephalopathy (PML). Infection by JCV is very common in childhood after which the virus enters a latent state, which is poorly understood. Under conditions of severe immunosuppression, especially AIDS, JCV may reactivate to cause PML. Expression of JC viral proteins is regulated by the JCV non-coding control region (NCCR), which contains an NF-kappaB binding site previously shown to activate transcription. We now report that C/EBPbeta inhibits basal and NF-kappaB-stimulated JCV transcription via the same site. Gel shift analysis showed C/EBPbeta bound to this region in vitro and ChIP assays confirmed this binding in vivo. Further, a ternary complex of NF-kappaB/p65, C/EBPbeta-LIP and JCV DNA could be detected in co-immunoprecipitation experiments. Mutagenesis analysis of the JCV NCCR indicated p65 and C/EBPbeta-LIP bound to adjacent but distinct sites and that both sites regulate basal and p65-stimulated transcription. Thus C/EBPbeta negatively regulates JCV, which together with NF-kappaB activation, may control the balance between JCV latency and activation leading to PML. This balance may be regulated by proinflammatory cytokines in the brain.