Transcription requires the recognition of numerous DNA sequences by diverse transcription factors, which together assemble large nucleoprotein complexes that tether RNA polymerase and facilitate the initiation of RNA synthesis. In vivo the assembly of these transcription complexes occurs in a nuclear environment where the template DNA is compacted more than 10(5)-fold through the assembly of chromatin. Our current knowledge of chromatin structure raises the major issues of the accessibility of DNA to both transcription factors and RNA polymerase and of the progression of RNA polymerase along the chromatin fiber. Novel genetic and biochemical approaches have established that specific chromatin structures have a major impact on the transcription process. Precise alterations in histone sequence, nucleosome structure, and folding of the chromatin fiber influence both the activation and repression of genes. These results offer substantial insight into the role of modulations in chromosome structure during vertebrate development. Transcription factors, histones, and the organization of DNA within the chromosome are intimately linked, and only when the correct framework is assembled can they function together to achieve correct genetic regulation.