Drosophila rnelunoguster Schneider I1 cells contain a factor which inhibits transcription in vitro of cloned tRNA genes in crude extracts made from these cells. The inhibitor could, however, be effectively neutralized by addition of certain non-template DNAs.In the absence of the transcription inhibitor activity, the steady-state kinetics of tRNA production from cloned genes followed one-substrate enzyme kinetics to a high degree of accuracy. Maximal rates of transcription and apparent affinity constants were analyzed for a collection of cloned D. melunogaster tRNASe' genes. The stability of the complex formed by the transcription proteins and the template DNA was found to be nearly constant for the genes examined. The transcription rates, however, were greatly influenced by the DNA sequences flanking the tRNA genes.Analysis of transcription competition between DNA templates showed pure competitive behavior. inhibition constants derived from these experiments indicated that the formation of the transcription complex was affected by sequences flanking the tRNA genes. Furthermore, the rate-limiting step in complex formation was independent of the stability of the final form of the complex. Transcription experiments in vitro have shown that specific transcription requires protein factors which do not normally copurify with RNA polymerase 111 [19,25 -281. Furthermore, during transcription a stable association between the DNA template and at least one of the transcription factors is formed [7,21,29, 301. This formation of a complex can be observed by a time course of synthesis experiment, which shows a lag period in product formation [7, 301 and in competition experiments in which the association between factors and the template leads to exclusion of transcription of a second template added at a later time [7,10,29, 301. The rates of RNA synthesis are usually linear after the lag period for up to 2 h. Transcription reactions in vitro have been used to examine the effects of alterations in DNA sequence on transcription rates and to assess the importance of sequence and structural features of the genes and their variants.