The genetic information in mammalian cells exits is organized into a highly condensed nucleoprotein structure whose basic repeating subunit is the nucleosome. Although the major function of this structure is usually thought to be packaging the very large amounts of DNA into a minimal volume, an important and unanswered question concerns whether the interaction of transacting gene regulatory factors with their DNA-binding sites is affected by the organization of these sites in chromatin. We have shown that nucleosomes are phased across the steroid-regulated mouse mammary tumor virus (MMTV) promoter. The sites to which steroid-receptors bind are displayed on the surface of nucleosome B in this phased array. Hormone activation of the promoter leads to active displacement of this nucleosome, in contrast to other systems where nucleosome deposition is thought to inhibit factor access. Receptor activated by a steroid antagonist, dexamethasone-21 mesylate, although translocated to the nucleus, is unable to interact productively with MMTV chromatin.