During Caenorhabditis elegans early larval development environmental conditions promote a cascade of signaling molecules to direct growth to the reproductive adult or to arrest development as a dauer larva. Two parallel chemosensory signal transduction pathways, one of which is transforming growth factor (TGF)-beta-like, converge on the daf-12 gene to regulate dauer formation. A third insulin-like signaling pathway interacts with the daf-12 pathway to regulate both dauer formation and adult longevity. To further understand the role of daf-12 in these processes, we have molecularly characterized this gene. We establish rescue of the mutant dauer defective phenotype with a genomic clone. We show that three transcripts of different lengths, due to differential splicing, are made from the daf-12 gene. The deduced protein isoforms are similar to both DNA- and ligand-binding domains of nuclear hormone receptors. The three daf-12 transcripts are produced throughout development and expression increases during the preparation for and execution of dauer formation. Analysis of various daf mutant strains suggests that the isoform ratios of daf-12 steady-state mRNA are not changed by reduction of function in the TGF-beta and insulin signaling components of the dauer pathway. The daf-12 promoter directs expression of GFP in the pharynx. daf-12 is a C. elegans nuclear hormone receptor with multiple isoforms, is expressed throughout development in distinct cells, and functions under a variety of environmental conditions.