The highly conserved C-terminal domain (CTD) of the largest subunit of RNA polymerase II comprises a consensus heptad (Y₁S₂P₃T₄S₅P₆S₇) repeated multiple times. Despite the simplicity of its sequence, the essential CTD domain orchestrates eukaryotic transcription and co-transcriptional processes, including transcription initiation, elongation, and termination, and mRNA processing. These distinct facets of the transcription cycle rely on specific post-translational modifications (PTM) of the CTD, in which five out of the seven residues in the heptad repeat are subject to phosphorylation. A hypothesis termed the “CTD code” has been proposed in which these PTMs and their combinations generate a sophisticated landscape for spatiotemporal recruitment of transcription regulators to Pol II. In this review, we summarize the recent experimental evidence understanding the biological role of the CTD, implicating a context-dependent theme that significantly enhances the ability of accurate transcription by RNA polymerase II. Furthermore, feedback communication between the CTD and histone modifications coordinates chromatin states with RNA polymerase II-mediated transcription, ensuring the effective and accurate conversion of information into cellular responses.