Transcription from the HIV-1 long terminal repeat (LTR) is regulated by the viral transactivator Tat, which increases RNA polymerase II (RNAP II) processivity. Previous reports have demonstrated that phosphorylation of the RNAP II carboxy-terminal domain by TFIIH and P-TEFb is important for Tat transactivation. Our present results demonstrate that phosphorylation of the RAP74 subunit of TFIIF is also an important step in Tat transactivation. Interestingly, while the general transcription factor TFIIF is required for both basal and Tat-activated transcription, phosphorylation of the RAP74 subunit occurs in the presence of Tat and correlates with a high level of transcription activity. Using a biotinylated DNA template transcription assay, we provide evidence that RAP74 is phosphorylated by TAF(II)250 during Tat-activated transcription. Depletion of RAP74 from the HeLa nuclear extract inhibited HIV-1 LTR-driven basal transcription and Tat transactivation. The addition of TFIIF, reconstituted from recombinant RAP30 and RAP74, to the depleted HeLa nuclear extract resulted in restoration of Tat transactivation. Of importance, the exogenous RAP74 was rapidly phosphorylated in the presence of Tat. These results suggest that RAP74 phosphorylation is one important step, of several, in the Tat transactivation cascade.