Wild-type lambda repressor activates transcription from the lambda PRM promoter by stimulating the rate-limiting isomerization step in the initiation reaction. The positive-control mutants of lambda repressor retain the ability to bind operator DNA normally, but fail to activate transcription from the lambda PRM promoter in vivo. We have characterized one of these mutants in vitro, and have determined the biochemical nature of the defect. We show that the mutant repressor was deficient in its ability to stimulate the isomerization step in transcription initiation. The initial binding of RNA polymerase to PRM was only slightly reduced by the mutant repressor. We also found that the mutant and wild-type repressors had similar affinities for all three binding sites in the rightward operator. These results provide support for the hypothesis that direct repressor-RNA polymerase interactions are important in the PRM activation mechanism.