Baculovirus viral DNA replication and transcriptional regulation are essential components to the life cycle of the virus and also important issues for expression of the engineered protein using this useful viral tool. The polyhedrin upstream sequence (pu) has been previously shown to function as an enhancer in an infection dependent manner. It is also the second known enhancer identified in baculovirus in addition to the homologous regions (hrs). Differing from hrs, the enhancer’s function of pu requires the presence of viral infection, suggesting that virus-encoded factors are required for pu’s enhancer function. To identify these factor(s), a cosmid library of Autographa californica multiple nucleopolyhedrovirus (AcMNPV) genomic DNA was constructed. Sequential fragmentation/analysis reveals 3 virus-encoded factors affecting pu’s enhancer function. These factors include IE1, IE2, and PE38 with IE1 being essential and IE2/PE38 being stimulatory. Northern blot analysis result further showed that pu and IE1 function together to stimulate the transcription activity of target promoter, and pu is therefore defined as a transcriptional enhancer. Of the three orfs that constitute pu, orf6 encodes the late expression factor 2 (lef-2) of AcMNPV and is the best studied one. It is one of the 20 late expression factors which are essential for baculoviral late gene expression. It’s been implicated to involve in both origin-dependent DNA replication and late gene expression. To better study the role of lef-2 in the life cycle of the virus, a lef-2 deletion bacmid was constructed and analyzed. The results show that lef-2 is indeed required for efficient viral DNA replication and late/very late gene expression. However, low-level of viral DNA replication could be detected in the absence of lef-2, suggesting that the function of this gene may be stimulatory rather than essential, as previously suggested, for viral DNA replication. The temporal/spatial distribution of LEF-2 in the infected cells was also analyzed. In addition, it was found that LEF-2 was associated with the nucleocapsids of both budded viruses and occluded-derived viruses, suggesting that its function may be required immediately after viral entry into host cells. In addition to arthropods, baculovirus can also enter a variety of mammalian cells with varied efficiencies and has therefore been proposed as an alternative gene delivery tool. To optimize baculovirus transduced gene expression in target mammalian cells, we found that the known baculovirus trans-activator, IE1, could stimulate the expression of cytomegalovirus immediate early (CMVie) promoter. This IE1-mediated stimulation of CMVie promoter activity can be further enhanced by the presence of hr, the known baculovirus enhancer for better gene expression.