The molecular mechanism underlying microtubule dynamic instability depends on the relationship between the addition of tubulin-GTP to a growing microtubule and its hydrolysis in the microtubule lattice to tubulin-GDP, with release of inorganic phosphate (P-i). Since this relationship remains controversial, we have re-examined the release of P-i upon microtubule assembly using a fluorometric assay for P-i, based on the phosphate-binding protein of Escherichia coli [Brune M., Hunter, J. L., Corrie, J. E. T., and Webb, M. R. (1994) Biochemistry 33, 8262-8271]. Microtubule assembly and Pi release were monitored simultaneously in a standard fluorimeter as an increase in the turbidity and fluorescence, respectively, in tubulin-GTP solutions assembled under conditions supporting dynamic instability. At the steady state of assembly, P-i release is nonlinear with respect to time, proceeding at a rate determined by the following: (a) the intrinsic GTPase activity of the nonpolymerized tubulin-GTP, and (b) the microtubule number concentration, which decreases progressively. Direct observation of the time course of nucleated microtubule assembly indicates that P-i release is closely coupled to microtubule elongation, even during the initial stages of assembly when uncoupling of tubulin-CTP addition and GTP hydrolysis would be most evident. Studies of the inhibition and reversal of the growth phase by cytostatic drugs show no evidence of a burst of P-i release. We conclude that nucleotide hydrolysis can keep pace with tubulin-GTP addition rates of 200 molecules per second per microtubule and that extended caps of tubulin-GTP or tubulin-GDP-P-i are not generated in normal assembly, nor are they required to stabilize growing microtubules or to support the phenomenon of dynamic instability of microtubules at the steady state.