The U6 small nuclear (sn)RNA gene (SNR6) from the yeast Saccharomyces cerevisiae is transcribed by RNA polymerase III in vivo. This gene is unusual in having a TATA box at position -30, and an essential B-block element located downstream of the T-rich termination signal. The B block is one of the two intragenic promoter elements of transfer RNA genes that are recognized by transcription factor (TF)IIIC (ref. 4). But accurate in vitro transcription of yeast U6 snRNA gene by PolIII in a purified system requires only TFIIIB components, including the TATA-box binding protein TBP. Here we report that, after nucleosome reconstitution or chromatin assembly, U6 snRNA synthesis becomes dependent on TFIIIC and on the integrity of the B-block element. This observation resolves an apparent paradox between in vitro and in vivo results concerning the necessity of the downstream B-block element and sheds light on a new role of TFIIIC in gene activation.