NRs function as molecular machines to transduce a hormonal signal into a transcriptional response. As sequence-specific DNA binding proteins, the action of the receptor primarily occurs at the site of the target gene. Quiescent genes could be viewed as being wrapped in a protective chromatin shield to fend off centroviral advances from an errant RNA polymerase. Dramatic effects of hormones on chromatin structure have long been recognized; whether this was causal to the transcriptional response or merely its consequence was unclear. In addition, how such changes in chromatin structure were directed by receptors was simply unknown. One popular model is that mere binding by receptor was sufficient to initiate a change in chromatin by altering nucleosome position. In contrast, the effort to identify the biochemical basis for transcriptional regulation has led in recent years to the consideration that NR cofactors might serve as active mediators of the regulatory effect. From the view of an insider, it has often seemed that those labs studying chromatin remodeling and those studying NR cofactors appeared to be on opposite sides of the arena taking unrelated approaches to an otherwise common quest. However, in the last year, these two fields, like lost allies, have been reintroduced to each other and are enjoying a new-found synergy. M. Beato (University of Marburg) outlined the general pathway by which the MMTV LTR utilizes a chromatin-based structure to control its transcription. In this case, nucleosomes are phased in a fashion that allows glucocorticoid receptor but not other transcription factors to bind to target DNA. Accordingly, hormone treatment leads to a rapid alteration in chromatin structure and at the same time promotes cooperative binding of other transcription factors. Presumably, it is the packaging of DNA into a repressive chromatin structure that restricts the accessibility of the template to the basal transcription machinery. Thus, as suggested by Beato, and supported by experiments reported by O. Wrange (Karolinska Institute) using in vitro–reconstituted nucleosomes, the role of the glucocorticoid receptor is to function, at least in part, to counteract chromatin-mediated repression. As discussed by L. Krause (UCSD) and J. Kadonaga (UCSD), the “ground” state or default status of an endogenous target gene would be transcriptionally inactive. The role of a transcription factor would be to initially counteract the chromatin effect leading to a derepressed template. This, in turn, would be followed by a “true activation” event equivalent to robust transcriptional initiation. Kadonaga described dissection of this putative multistep process by creating chromatin templates to directly assess the action of NRs in an in vitro–reconstituted system. While previous in vitro transcription studies have been described, this is the first with chromatin-based templates. The effects with the estrogen receptor (ER) are clear and dramatic. Fifteen- to fifty-fold inductions were seen, all in a hormone-dependent fashion. The estrogen receptor can be added either before or after chromatin assembly, and the entire process was shown to be dependent on the known activation domains in the ER. The improved regulation appears to be a consequence of chromatin suppressing basal activity of the promoter thus increasing the fold of induction. Interestingly, estrogen antagonists failed to activate although these complexes can be bound to the template. Continuing in this vein, A. Wolffe (NICHD) described the use of replication-dependent chromatin assembly to identify three regulatory steps in the regulation of transcription by the thyroid hormone receptor (TR). These three steps include: (1) the establishment of a repressive chromatin structure; (2) disruption of the chromatin template; and (3) transcriptional activation. As is apparent, this is similar to the events described by Kadonaga and Beato although with a completely different regulatory system. In this approach, cloned templates are microinjected into the Xenopus oocyte nucleus, which are then assembled in a natural chromatin structure. In this way, Wolffe has been able to address one of the more vexing problems in NR transcription by demonstrating that nonliganded RXR:TR heterodimers can not only bind to chromatin but also may facilitate the formation of a repressive chromatin structure. Conclusions that arise out of this important model system include the demonstration that the nonliganded TR:RXR heterodimers bind to nucleosome DNA, make use of chromatin to repress transcription, control nucleosome position, and can influence both nucleosome modificat