Uroplakin Ib is a structural protein on the surface of urothelial cells. Levels of uroplakin Ib mRNA are dramatically reduced or absent in many transitional cell carcinomas, but the molecular mechanisms responsible remain undetermined. Previously, we showed that loss of uroplakin Ib expression correlated with CpG methylation of Sp1/NFκB-binding motifs within the proximal promoter. In this study, we show that reporter activity was completely blocked by the methylation of three CpG pairs in this promoter region. Gel shift analysis using purified proteins or nuclear extracts showed that Sp1 and NFκB bound to motifs encompassing two of the three CpG pairs. Interestingly, the methylation of these two CpG sites did not prevent the binding of proteins to the promoter in gel shift analyses. Additionally, mutation of these two CpGs did not affect reporter activity, but mutation of 6-bp fragment spanning each CpG partially inhibited reporter activity, suggesting that these sites were functional. A requirement for both Spi and NFκB in regulating reporter activity was confirmed in transfection experiments using plasmids expressing individual proteins. Our data suggest that the methylation of specific CpG sites can silence the uroplakin Ib promoter, at least in part, by blocking the binding of Sp1 and NFκB, although other factors may be involved.