The human immunodeficiency virus type 1 (HIV-1) Tat protein activates transcription elongation by stimulating the Tat-activated kinase (TAK/p-TEFb), a protein kinase composed of CDK9 and its cyclin partner, cyclin T1. CDK9 is able to hyperphosphorylate the carboxyl-terminal domain (CTD) of the large subunit of RNA polymerase during elongation. In addition to TAK, the transcription elongation factor Spt5 is required for the efficient activation of transcriptional elongation by Tat. To study the role of Spt5 in HIV transcription in more detail, we have developed a three-stage Tat-dependent transcription assay that permits the isolation of active preinitiation complexes, early-stage elongation complexes, and Tat-activated elongation complexes. Spt5 is recruited in the transcription complex shortly after initiation. After recruitment of Tat during elongation through the transactivation response element RNA, CDK9 is activated and induces hyperphosphorylation of Spt5 in parallel to the hyperphosphorylation of the CTD of RNA polymerase II. However, immunodepletion experiments demonstrate that Spt5 is not required for Tat-dependent activation of the kinase. Chase experiments using the Spt5-depleted extracts demonstrate that Spt5 is not required for early elongation. However, Spt5 plays an important role in late elongation by preventing the premature dissociation of RNA from the transcription complex at terminator sequences and reducing the amount of polymerase pausing at arrest sites, including bent DNA sequences. This novel biochemical function of Spt5 is analogous to the function of NusG, an elongation factor found in Escherichia coli that enhances RNA polymerase stability on templates and shows sequence similarity to Spt5.Transcription from the human immunodeficiency virus (HIV) promoter is regulated both at the level of initiation and elongation (for recent reviews, see references 14, 26, 48, and 54). In activated T cells and other permissive cell types, initiation of HIV transcription is very efficient, but production of full-length transcripts requires the viral regulatory protein Tat. In the absence of Tat, the majority of RNA polymerase II complexes that initiate transcription at the HIV promoter disengage from the template near to the promoter (24, 35). Tat strongly activates RNA polymerase processivity and permits the synthesis of full-length HIV transcripts both in vivo and in cell-free transcription systems (11,17,27,28,39,40,50,53).Tat is an RNA-binding protein that is recruited to early HIV transcription complexes by binding to the transactivation response element (TAR), an RNA stem-loop structure that is located at the 5Ј end of HIV transcripts (5, 12, 28, 51, 52). The interaction between Tat and TAR involves not only the binding of Tat to TAR RNA but also its association with the Tat-activated kinase (TAK) (20, 38, 69), a protein kinase that is able to phosphorylate the carboxyl-terminal domain (CTD) of the large subunit of RNA polymerase II (21,43,65).TAK is composed of a kinase subunit, CDK9, and its c...