Highly purified chicken progesterone receptor (cPR) is shown to stimulate RNA synthesis directly in an in vitro transcription assay. Stimulation of transcription by cPR requires the presence of progesterone response elements (PREs) in the template and can be specifically inhibited by addition of competitor oligonucleotides containing PREs. Binding of receptor to two PREs is cooperative and leads to synergistic (27-fold) stimulation of transcription. A purified fusion protein containing the DNA binding domain of cPR linked to yeast ubiquitin was produced in E. coli and also functions in the transcription assay. Using this in vitro transcription system, we demonstrate that hormone-free cPR activated by salt treatment induces transcription of a test gene in a hormone-independent manner. Finally, we present evidence that the progesterone receptor acts by facilitating the formation of a stable preinitiation complex at the target gene promoter and thus augments the initiation of transcription by RNA polymerase II.