The intracellular DNA of bacteria, bacteriophage and plasmids is subject to topological constraints that function to maintain it in a superhelical conformation. For the last several years, accumulating evidence has indicated that supercoiling of DNA duplex is required for effective transcription, as well as for the replication and recombination of cellular DNA. The relevance of DNA superhehlicity to transcription in vivo has been suggested by the observations that the overall rate of transcription directed by the E. coli, bacteriophage and plasmid genomes is generally reduced when the activity of DNA gyrase is inhibited by the specific drugs, such as nalidixic acid or coumermycin. An interesting observation from our in vitro studies has been that stimulation of transcription by superhelicity of DNA is more pronounced with S 100 crude extract proteins than with pure RNA polymerase.DNA in the prokayrotic cell has a compact conformation due to its interaction with cellular proteins (Histone like proteins). Recentry, seven classes of those proteins (HLP I, HLP II, 28K protein etc.) have been isolated and characterized as essential components of the nucleoid. In this review, we focus on the effect of superhelical conformation of the DNA duplex and association of the DNA with the nucleoid proteins on transcription.