Transcription of the Bombyx mori fibroin gene in a posterior silk gland extract can be separated into three functional steps on the basis of sensitivity to Sarkosyl: 1) formation of an initiation complex, which is blocked by 0.025% Sarkosyl; 2) conversion of the initiation complex to an elongation complex, a step sensitive to 0.05% Sarkosyl; 3) the subsequent elongation of RNA chain which occurs in the presence of 0.05% Sarkosyl. Whereas the last two steps are rapid and unaffected by template topology, the first step is slow and affected by DNA conformation. In the posterior silk gland extract, closed circular DNA forms a superhelical state and supports more rapid assembly of the initiation complex than linear DNA does. Both DNA supercoiling and rapid assembly of the initiation complex require ATP and are abolished by the addition of a topoisomerase II inhibitor VP16. These results suggest that DNA supercoiling enhances the fibroin gene transcription by facilitating formation of the initiation complex.