Regulation of MHC class I gene transcription is mediated by the coordinate activities of the basal promoter and upstream regulatory elements, to achieve tissue-specific levels of expression which are further dynamically modulated in response to extracellular signals. The recent research focus of the laboratory has been to define the critical sequence organization of the core promoter, the transcription initiation complexes that are required for transcription of the basal promoter, and upstream elements that modulate basal promoter activity. The MHC class I core promoter is complex, consisting of three elements: a variant TATAA box, an Initiator and an S-box. The relative contribution of each element to overall transcriptional activity is determined both by upstream sequences and cell-type specific factors. While the contributions of the TATAA-like box and Initiator are variable, an intact S-box is required for optimum basal expression. In contrast, the S-box is not required for activated transcription. Thus, the g-interferon-induced coactivator, CIITA, activates class I transcription of an S-box mutant, which is defective for basal transcription. Similarly, basal class I transcription is TAFII250-dependent, whereas CIITA-activated transcription operates through a distinct pathway that requires neither TAFII250 nor the S-box core promoter sequences. Further, CIITA-activated class I transcription is not affected by HIV Tat, which represses basal class I transcription by inhibiting the acetyl transferase activity of TAFII250. Thus, basal and activated transcription target distinct core promoter sequences and nucleate distinct transcription initiation complexes. We propose that transcription initiation at the core promoter is a dynamic process in which the mechanisms of core promoter function differ depending on the cellular environment.