The mechanism of the productive initiation of RNA synthesis in vitro by Escherichia coli RNA polymerase holoenzyme was investigated by using DNA from the T7 deletion mutant ∆D111 as a template under conditions such that RNA chains are initiated exclusively from the Al promoter. Kinetic studies by a non-steady-state method revealed that the binding of the first two nucleoside triphosphates, corresponding to the 5'-terminal and penultimate nucleotides of the RNA transcript, to the enzyme-promoter complex during the productive initiation is rapid and ordered, namely, ATP binds first followed by UTP. The same mechanism was also observed for productive initiation at the D promoter. The time course of the incorporation of the first four 5'-terminal nucleotides into the RNA synthesized from the Al promoter was studied by a fast kinetic technique. Under our experimental conditions, the times for the half-maximal incorporation of ATP, UMP, CMP, and GMP, each at an initial concentration of 0.1 mM, were 0.03 (or less), 0.16, 0.35, and 0.40 s, respectively. These incorporations were completed within 1 s and maintained for up to 90 s at a constant level which was dependent on the initial nucleotide concentration. The half-saturation concentrations for ATP, UTP, CTP, and GTP were 80, 88, 20, and 7µM, respectively. At saturating nucleotide concentrations, the level of incorporation was approximately equal to the promoter concentration. We have found that productive initiation at the Al promoter is activated by the third nucleotide, CTP, and the fourth nucleotide, GTP, the former being a more potent activator than the latter. The observation that mono- and diphosphates of these two nucleotides are also activators of the productive initiation suggests that the activation is not due to the phosphodiester bond formation. Kinetic analysis indicates that the activator binds to a regulatory site on the enzyme-promoter complex and exerts its action at a step after the formation of the first phosphodiester bond. Furthermore, GTP inhibits the abortive initiation at the Al promoter. A minimal mechanism of RNA chain initiation consistent with all our results is proposed. RNA polymerase binds to a promoter site to form an openpromoter complex. The binding of the first two nucleotides to this binary complex is rapid and ordered. A phosphodiester bond is then formed to yield a dinucleotide, with the release of pyrophosphate. In the presence of a regulatory nucleotide, corresponding to the third or fourth nucleotide, the translocation of the enzyme along the DNA template is facilitated to form a productive initiation complex which is ready for elongation of an RNA chain. In the absence of the regulatory nucleotide, the dinucleotide is released from the enzyme-DNA complex, and the initiation is aborted. Discrimination between the productive and abortive initiation pathways by a regulatory nucleotide may play an important role in the control of specific RNA synthesis and in the enhancement of the fidelity of transcriptional initiation.