Nab proteins constitute an evolutionarily conserved family of corepressors that specifically interact with and repress transcription mediated by three members of the NGFI-A (Egr-1, Krox24, zif/268) family of immediate-early gene transcription factors, which includes NGFI-C, Krox20, and Egr3. We explored the mechanism of Nab1 repression and identified structural domains required for Nab1 function. Nab1 does not act by blocking DNA binding or nuclear localization of NGFI-A. In fact, Nab1 repression is not unique to NGFI-A because multiple types of non-NGFI-A activation domains were repressed, as was a heterologous transcription factor carrying the NGFI-A R1 domain, which is required for Nab1 interaction. Additionally, Nab1 tethered directly to DNA repressed constitutively active promoters. Tethered repression was not dependent on the identity of the basal promoter elements, the presence of a distal enhancer, or the distance separating the binding sites from the promoter. These results suggest that Nab1 repression is not specific to particular activators and that Nab1 is an active repressor that works by a direct mechanism. We identified a bipartite-like nuclear localization sequence and localized the repression function to the Nab conserved domain 2 (NCD2), a region found in the carboxy-terminal half of all Nab proteins. Three small regions of homology between Nab1 and previously characterized corepressors, Dr1 and E1b 55-kDa protein, were identified within NCD2. Replacement mutagenesis of residues conserved between these proteins interfered with Nab1 repression, although Nab1 does not function by the same mechanism as Dr1. The human NAB1 genomic locus was mapped to chromosome 2q32.3-33.