Transcriptional activation of erythropoietin, glycolytic enzymes, and vascular endothelial growth factor occurs during hypoxia or in response to cobalt chloride (CoCl₂) in Hep3B cells. However, neither the mechanism of cellular O₂sensing nor that of cobalt is fully understood. We tested whether mitochondria act as O₂sensors during hypoxia and whether hypoxia and cobalt activate transcription by increasing generation of reactive oxygen species (ROS). Results show (i) wild-type Hep3B cells increase ROS generation during hypoxia (1.5% O₂) or CoCl₂incubation, (ii) Hep3B cells depleted of mitochondrial DNA (ρ⁰cells) fail to respire, fail to activate mRNA for erythropoietin, glycolytic enzymes, or vascular endothelial growth factor during hypoxia, and fail to increase ROS generation during hypoxia; (iii) ρ⁰cells increase ROS generation in response to CoCl₂and retain the ability to induce expression of these genes; and (iv) the antioxidants pyrrolidine dithiocarbamate and ebselen abolish transcriptional activation of these genes during hypoxia or CoCl₂in wild-type cells, and abolish the response to CoCl₂in ρ° cells. Thus, hypoxia activates transcription via a mitochondria-dependent signaling process involving increased ROS, whereas CoCl₂activates transcription by stimulating ROS generation via a mitochondria-independent mechanism.