Tat stimulates human immunodeficiency virus type 1 (HIV-1) transcriptional elongation by recruitment of carboxyl-terminal domain (CTD) kinases to the HIV-1 promoter. Using an immobilized DNA template assay, we have analyzed the effect of Tat on kinase activity during the initiation and elongation phases of HIV-1 transcription. Our results demonstrate that cyclin-dependent kinase 7 (CDK7) (TFIIH) and CDK9 (P-TEFb) both associate with the HIV-1 preinitiation complex. Hyperphosphorylation of the RNA polymerase II (RNAP II) CTD in the HIV-1 preinitiation complex, in the absence of Tat, takes place at CTD serine 2 and serine 5. Analysis of preinitiation complexes formed in immunodepleted extracts suggests that CDK9 phosphorylates serine 2, while CDK7 phosphorylates serine 5. Remarkably, in the presence of Tat, the substrate specificity of CDK9 is altered, such that the kinase phosphorylates both serine 2 and serine 5. Tat-induced CTD phosphorylation by CDK9 is strongly inhibited by low concentrations of 5, 6-dichloro-1-beta-D-ribofuranosylbenzimidazole, an inhibitor of transcription elongation by RNAP II. Analysis of stalled transcription elongation complexes demonstrates that CDK7 is released from the transcription complex between positions +14 and +36, prior to the synthesis of transactivation response (TAR) RNA. In contrast, CDK9 stays associated with the complex through +79. Analysis of CTD phosphorylation indicates a biphasic modification pattern, one in the preinitiation complex and the other between +36 and +79. The second phase of CTD phosphorylation is Tat-dependent and TAR-dependent. These studies suggest that the ability of Tat to increase transcriptional elongation may be due to its ability to modify the substrate specificity of the CDK9 complex.