Reciprocal gene activation and restriction during cell type differentiation from a common lineage is a hallmark of mammalian organogenesis. A key question, then, is whether a critical transcriptional activator of cell type–specific gene targets can also restrict expression of the same genes in other cell types. Here, we show that whereas the pituitary-specific POU domain factor Pit-1 activates growth hormone gene expression in one cell type, the somatotrope, it restricts its expression from a second cell type, the lactotrope. This distinction depends on a two–base pair spacing in accommodation of the bipartite POU domains on a conserved growth hormone promoter site. The allosteric effect on Pit-1, in combination with other DNA binding factors, results in the recruitment of a corepressor complex, including nuclear receptor corepressor N-CoR, which, unexpectedly, is required for active long-term repression of the growth hormone gene in lactotropes.