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To explore the underlying mechanisms by which genes are regulated in eukaryotes, long-distance transcriptional activation and threshold effects were reconstituted in vitro. Long-range activation of transcription by GAL4-VP16 protein located 1300 base pairs upstream of the RNA start site was dependent on packaging of the template into histone H1-containing chromatin. A transcriptional threshold effect by GAL4-VP16 was observed with repressed chromatin templates but not naked DNA templates. The experimental data with the chromatin templates were similar to the theoretical activation profile that is predicted if the action of each DNA bound protomer of GAL4-VP16 were independent and additive in terms of free energy.