TdIF1 was originally identified as a protein that directly binds to DNA polymerase TdT. TdIF1 is also thought to function in transcription regulation, because it binds directly to the transcriptional factor TReP-132, and to histone deacetylases HDAC1 and HDAC2. Here we show that TdIF1 recognizes a specific DNA sequence and regulates gene transcription. By constructing TdIF1 mutants, we identify amino acid residues essential for its interaction with DNA. An in vitro DNA selection assay, SELEX, reveals that TdIF1 preferentially binds to the sequence 5'-GNTGCATG-3' following an AT-tract, through its Helix-Turn-Helix and AT-hook motifs. We show that four repeats of this recognition sequence allow TdIF1 to regulate gene transcription in a plasmid-based luciferase reporter assay. We demonstrate that TdIF1 associates with the RAB20 promoter, and RAB20 gene transcription is reduced in TdIF1-knocked-down cells, suggesting that TdIF1 stimulates RAB20 gene transcription.