The N-terminal domain (NTD) of steroid receptors harbors a transcriptional activation function (AF1) that is composed of an intrinsically disordered polypeptide. We examined the interaction of the TATA-binding protein (TBP) with the NTD of the progesterone receptor (PR) and its ability to regulate AF1 activity through coupled folding and binding. As assessed by solution phase biophysical methods, the isolated NTD of PR contains a large content of random coil, and it is capable of adopting secondary α-helical structure and more stable tertiary folding either in the presence of the natural osmolyte trimethylamine-N-oxide or through a direct interaction with TBP. Hydrogen-deuterium exchange coupled with mass spectrometry confirmed the highly dynamic intrinsically disordered property of the NTD within the context of full-length PR. Deletion mapping and point mutagenesis defined a region of the NTD (amino acids 350-428) required for structural folding in response to TBP interaction. Overexpression of TBP in cells enhanced transcriptional activity mediated by the PR NTD, and deletion mutations showed that a region (amino acids 327-428), similar to that required for TBP-induced folding, was required for functional response. TBP also increased steroid receptor co-activator 1 (SRC-1) interaction with the PR NTD and cooperated with SRC-1 to stimulate NTD-dependent transcriptional activity. These data suggest that TBP can mediate structural reorganization of the NTD to facilitate the binding of co-activators required for maximal transcriptional activation.