Fragments from the Ty-D15 element of Saccharomnyces cerevisiae were assayed for the ability to direct 3'-end formation for RNA initiated by the GAL] promoter. The 8, the direct repeat at each end of the element, was capable of forming 3' ends at two sites, an inefficient upstream site and an efficient downstream site near the end of the 8. Different sequences were required for 3'-end formation at these sites. For the efficient site, all transcripts had 3' ends in the 8 and no downstream transcription was detected, which suggested that these sequences terminate transcription. Surprisingly, the 8 region downstream of the initiation site for Ty RNA comprised part of this major site and terminated more than 50% of the transcripts that read into it. Sequences necessary for the efficient site were localized to two small regions. Both regions were upstream of the 3' end and contained similarities to a tripartite consensus sequence that has been proposed as a terminator element. Sequences near the position of the 3' end could also affect termination; a short G + C-rich sequence inserted just downstream changed an efficient terminator to an inefficient one. Initiation in the 8 had no effect on the efficiency or positions or termination in that 8. A new initiation site was seen when the same 8 terminated transcription, but transcriptional interference did not occur, since the amount of initiation was not decreased.