Abstract: We have identified and partially characterized a novel class III transcription factor fraction (TFIIIE) from yeast nuclear extracts. TFIIIE is functionally distinct from the standard yeast transcription factor fractions, TFIIIB and TFIIIC. It is also different from either of the TFIIIB subfractions, B' and B". TFIIIE is essential for specific transcription of both tRNA and 5 S RNA genes, its activity is sensitive to proteinase K, and it exhibits an apparent sedimentation coefficient of 4.0 S when analyzed on glycerol gradients. In the case of a tRNA gene, TFIIIE does not play a role in the formation of stable preinitiation complexes containing TFIIIB and TFIIIC. It is required for single as well as multiple rounds of transcription, however. Thus, TFIIIE is involved in the utilization of stable transcription complexes, but its action is not restricted to reinitiation events.