Synthesis of accurately initiated transcripts has been reconstituted with RNA polymerase II and a set of five transcription factors purified from rat liver. In addition to three previously identified factors alpha, beta gamma, and delta (Conaway, R. C., and Conaway, J. W. (1989) Proc. Natl. Acad. Sci. U. S. A. 86, 7356-7360), transcription in the reconstituted liver system requires two novel factors designated tau and epsilon. These five transcription factors comprise two functional classes: (i) promoter recognition factors (tau and epsilon), which interact with template DNA to facilitate formation of a stable initial complex that is subsequently recognized and bound by RNA polymerase II, and (ii) RNA chain initiation factors (alpha, beta gamma, and delta), which do not participate in formation of the initial complex, but which are essential for transcription initiation.