The largest subunit of RNA polymerase II (RNAPII) C-terminal heptarepeat domain (CTD) is subject to phosphorylation during initiation and elongation of transcription by RNA polymerase II. Here we study the molecular mechanisms leading to phosphorylation of Ser-7 in the human enzyme. Ser-7 becomes phosphorylated before initiation of transcription at promoter regions. We identify cyclin-dependent kinase 7 (CDK7) as one responsible kinase. Phosphorylation of both Ser-5 and Ser-7 is fully dependent on the cofactor complex Mediator. A subform of Mediator associated with an active RNAPII is critical for preinitiation complex formation and CTD phosphorylation. The Mediator-RNAPII complex independently recruits TFIIB and CDK7 to core promoter regions. CDK7 phosphorylates Ser-7 selectively in the context of an intact preinitiation complex. CDK7 is not the only kinase that can modify Ser-7 of the CTD. ChIP experiments with chemical inhibitors provide evidence that other yet to be identified kinases further phosphorylate Ser-7 in coding regions.In mammalian cells the C-terminal domain of the Rpb1 subunit of RNA polymerase II (RNAPII) 2 consists of 52 heptarepeats of the consensus sequence YSPTSPS (for review, see Refs. 1-3). When RNAPII enters the preinitiation complex (PIC) the CTD becomes phosphorylated at least on three serine residues, Ser-2, Ser-5, and Ser-7 (4), at a yet unknown number of repeat elements. In theory, combinations of modifications could generate a complex pattern sometimes referred to as CTD code hypothesis (5), in analogy to the modifications occurring on lysine, arginine, and serine residues within N-terminal tails of histones (6).Several kinases have been identified that modify the CTD. These are CDK1, CDK2, CDK7, CDK8, CDK9, Erk1/2, and DNA-dependent protein kinase. CDK1 and CDK2 phosphorylate preferentially Ser-5 of the CTD (7,8). In the case of CDK1 this has been associated with repression of transcription during mitosis (9). The signaling kinases Erk1/2 phosphorylate the RNAPII CTD in response to oxidative and osmotic stress (10). The promoter-associated kinase DNA-dependent protein kinase phosphorylates the CTD at Ser-7 in vitro, although it remains unclear whether this process is relevant to transcription (11, 12). CDK8 and the paralogue CDC2L6 are associated with the Mediator complex (13, 14). CDK8 has mostly been associated with repression of transcription, yet there are also reports that specific genes are activated by it (15, 16). CDK9 is thought to release RNAPII that is paused by negative inhibitory factors 5,6-dichloro-1--D-ribofuranosylbenzimidazole (DRB) sensitivity-inducing factor and negative elongation factor some 30 -40 base pairs downstream of the transcription start sites. RNAPII then resumes elongation of transcription, during which it becomes further phosphorylated at Ser-2. A marked increase of Ser-2 phosphorylation is often seen near the 3Ј end of genes (4, 17). It is unclear whether this phosphorylation of the CTD near the polyadenylation site is necessary for efficient el...