We have studied the requirements for the in vitro assembly of transcriptionally active 5S RNA gene chromatin from cloned Xenopus laevis 5S plasmid DNA. Both plasmid DNA and DNA assembled into chromatin with Xenopus oocyte extracts are transcribed efficiently in vitro. Chromatin prepared by NaCl reconstitution with purified histones in the absence of any cellular factors, however, is transcriptionally inert. A transcriptionally active template is formed if plasmid DNA is incubated in an ovary extract prior to, but not after, NaCl reconstitution. The cellular component responsible for this effect is the 5S RNA transcription factor TFIIIA. Both chromatographically purified TFIIIA and TFIIIA derived from 7S RNP particles can complex with 5S DNA to yield an active chromatin template upon reconstitution with histones. This effect is specific for 5S RNA genes, since TFIIIA will not form an active template when incubated with a cloned Bombyx mori alanine tRNA gene.