Double-stranded deoxyribonucleic acid (DNA) from bacteriophage lambda is a good template for wheat germ DNA-dependent ribonucleic acid (RNA) polymerase II. We delineated conditions for obtaining maximum polymerase activity using as template both the relatively intact DNA extracted from the the lambda phage and DNA into which single-strand nicks have been introduced by deoxyribonuclease (DNase) I digestion. The deliberate introduction of nicks produces a modest increase in transcription. The NaCl and MgCl2 optima are broader with the nicked template, so that higher concentrations of these salts are needed before polymerase activity begins to decline. Heparin inhibits initiation but not elongation by wheat germ polymerase. Polymerase can be protected against heparin inhibition by forming binary complexes with the template. The formation of these complexes is reduced at low temperature. The complexes, once formed, decay in the presence of heparin with a half-life of 10--20 min. The number of complexes is highly dependent on the degree of nicking of the template, suggesting that single-strand nicks are the predominant type of site where these heparin-resistant complexes are formed. Our data do not allow us to decide whether or not the presence of nicks plays as decisive a role in the absence of heparin.