Transcription initiation at eukaryotic protein-coding gene promoters is regulated by a complex interplay of site-specific DNA-binding proteins acting synergistically or antagonistically. Here, we have analyzed the mechanisms of synergistic transcriptional activation between members of the CCAAT-binding transcription factor/nuclear factor I (CTF/NF-I) family and the estrogen receptor. By using cotransfection experiments with HeLa cells, we show that the proline-rich transcriptional activation domain of CTF-1, when fused to the GAL4 DNA-binding domain, synergizes with each of the two estrogen receptor-activating regions. Cooperative DNA binding between the GAL4-CTF-1 fusion and the estrogen receptor does not occur in vitro, and in vivo competition experiments demonstrate that both activators can be specifically inhibited by the overexpression of a proline-rich competitor, indicating that a common limiting factor is mediating their transcriptional activation functions. Furthermore, the two activators functioning synergistically are much more resistant to competition than either factor alone, suggesting that synergism between CTF-1 and the estrogen receptor is the result of a stronger tethering of the limiting target factor(s) to the two promoter-bound activators.