PHOSPHORYLATION of the heptapeptide repeats in the C-terminal domain (CTD) of the largest subunit of RNA polymerase II has been widely proposed as an essential step in transcription initiation1-8 on the basis of findings indicating (1) that the CTDs of RNA polymerase II molecules actively engaged in transcription are highly phosphorylated4,9,10; (2) that polymerase molecules containing non-phosphorylated CTDs preferentially enter the preinitiation complex3,11,12 where they are subsequently phosphorylated3,13; and (3) that essential initiation factors b from yeast14-16, delta from rat17,18, and BTF2(TFIIH) from human cells19-21 have closely associated CTD-kinase activities. Here we take advantage of a highly purified enzyme system which supports both CTD phosphorylation and basal transcription to test this hypothesis directly. Using the isoquinoline sulphonamide derivative H-8, which is a potent inhibitor of CTD kinase, we show that basal transcription occurs in the absence of CTD phosphorylation.