We have investigated the manner by which progesterone receptors act to induce initiation of RNA synthesis in a cell-free system derived from chick oviduct. A method utilizing rifampicin enabled us to measure the formation of binary initiation complexes between RNA polymerase and chick oviduct chromatin (Tsai, M.-J., Schwartz, R.J., Tsai S.Y., and O'Malley, B.W. (1975) J.Biol. Chem. 250, 5165-5174) and allowed for the quantitative assessment of RNA chain initiation sites, RNA chain propagation rates, and RNA chain size under conditions which prevent secondary chain reinitiations. We have measured the available initiation sites for transcription in oviduct chromatin prepared from chicks withdrawn from all hormone and then restimulated with a secondary injection of progesterone. Within 1/2 hour after administration of progesterone, the number of initiation sites increased from 8,700 sites/pg of chromatin DNA for the control to 15,500 sites. After 1 hour, the concentration of RNA polymerase needed to saturate chromatin binding sites was increased 60% in comparison to control values, while the number of initiation sites increased 160%. This rapid increment in transcriptional activity preceded temporally the induction of synthesis of ovalbumin mRNA. To test directly the effect of progesterone receptor on transcription, in vitro, a reconstituted cell-free system was employed which contained purified cytoplasmic progesterone-receptor complexes, Escherichia coli RNA polymerase, and chromatin prepared from hormonally withdrawn chick oviducts. Purified progesterone-receptor complex stimulated transcription of oviduct chromatin in vitro by promoting an increase of 3,000 to 5,000 additional sites for RNA chain initiation. These data showed that progesterone receptor can directly increase the number of RNA polymerase binding and initiation sites in the chromatin template in the absence of a detectable change in either the rate of RNA chain propagation or the size of the RNA product. The kinetics of progesterone-receptor stimulation of RNA synthesis in chromatin revealed a t1/2 of 15 min for this effect to occur. This value was identical with the optimal time required for binding of receptor to chromatin. The concentration of receptor required for half-maximal stimulation of RNA chain initiation was approximately 5 x 10(-9) M. This value agreed closely with our previously reported estimates of the affinity (Kd approximately 5 x 10(-9)M) of the progesterone-receptor complex for oviduct chromatin. The stimulatory effect of purified progesterone receptor appeared to be relatively specific for oviduct chromatin in comparison to nontarget tissue chromatins or chick DNA. The data presented here show that steroid hormone-receptor complex can directly regulate gene transcription in vitro in a manner which mimics the events observed in vivo in target cells.