The molecular mechanism underlying microtubule dynamic instability depends on the relationship between the addition of tubulin-GTP to a growing microtubule and its hydrolysis in the microtubule lattice to tubulin-GDP, with release of inorganic phosphate (Pi). Since this relationship remains controversial, we have re-examined the release of Pi upon microtubule assembly using a fluorometric assay for Pi, based on the phosphate-binding protein of Escherichia coli [Brune M., Hunter, J. L., Corrie, J. E. T., and Webb, M. R. (1994) Biochemistry 33, 8262-8271]. Microtubule assembly and Pi release were monitored simultaneously in a standard fluorimeter as an increase in the turbidity and fluorescence, respectively, in tubulin-GTP solutions assembled under conditions supporting dynamic instability. At the steady state of assembly, Pi release is nonlinear with respect to time, proceeding at a rate determined by the following: (a) the intrinsic GTPase activity of the nonpolymerized tubulin-GTP, and (b) the microtubule number concentration, which decreases progressively. Direct observation of the time course of nucleated microtubule assembly indicates that Pi release is closely coupled to microtubule elongation, even during the initial stages of assembly when uncoupling of tubulin-GTP addition and GTP hydrolysis would be most evident. Studies of the inhibition and reversal of the growth phase by cytostatic drugs show no evidence of a burst of Pi release. We conclude that nucleotide hydrolysis can keep pace with tubulin-GTP addition rates of 200 molecules per second per microtubule and that extended caps of tubulin-GTP or tubulin-GDP-Pi are not generated in normal assembly, nor are they required to stabilize growing microtubules or to support the phenomenon of dynamic instability of microtubules at the steady state.