The endoplasmic reticulum (ER) transmembrane proteins, ATF6alpha and ATF6beta, are cleaved in response to ER stress, which can be induced by tunicamycin. The resulting N-terminal fragments of both ATF6 isoforms, which have conserved basic leucine-zipper and DNA binding domains but divergent transcriptional activation domains, translocate to the nucleus where they bind to ER stress-response elements (ERSE) in ER stress-response genes (ERSRG), such as GRP78. Although it is known that ATF6alpha is a potent activator of ERSRGs, the transcriptional potency and functions of ATF6beta remain to be explored. Accordingly, N-terminal fragments of each ATF6 isoform (N-ATF6alpha and N-ATF6beta) were overexpressed in HeLa cells and the effects on GRP78 induction were assessed. When expressed at similar levels, N-ATF6alpha conferred approximately 200-fold greater GRP78 promoter activation than N-ATF6beta. Because ER stress activates nuclear translocation of both ATF6alpha and beta and because both bind to ERSEs, the effect of co-expressing them on GRP78 induction was assessed. Surprisingly, N-ATF6beta inhibited N-ATF6alpha-mediated GRP78 promoter activation in a dominant-negative manner. Moreover, N-ATF6beta inhibited TN-mediated GRP78 promoter activation, which requires endogenous ATF6alpha. ATF6 isoform-specific small inhibitory RNAs were used to show that, as expected, endogenous ATF6alpha was required for maximal ERSRG induction; however, endogenous ATF6beta moderated ERSRG induction. These results indicate that compared with ATF6alpha, ATF6beta is a very poor activator of ERSRG induction and it represses ATF6alpha-mediated ERSRG induction. Thus, ATF6beta may serve as a transcriptional repressor functioning in part to regulate the strength and duration of ATF6alpha-mediated ERSRG activation during the ER stress response.