Transcription consists of a series of highly regulated steps: assembly of a preinitiation complex (PIC) at the promoter nucleated by TFIID, followed by initiation, elongation, and termination. The present study has focused on the role of the TFIID component, TAF7, in regulating transcription initiation. In TFIID, TAF7 binds to TAF1 and inhibits its intrinsic acetyl transferase activity. We now report that although TAF7 remains bound to TAF1 and associated with TFIID during the formation of the PIC, TAF7 dissociates from the PIC upon transcription initiation. Entry of polymerase II into the assembling PIC is associated with TAF1 and TAF7 phosphorylation, coincident with TAF7 release. We propose that the TFIID composition is dynamic and that TAF7 functions as a check-point regulator suppressing premature transcription initiation until PIC assembly is complete.