Acetylation is a well-known regulatory post-translational modification, but a biological function for acetylation in regulating basal transcription factors has not been reported. Here we show that the general transcription factor TFIIB, which is required for the initiation of eukaryotic polymerase II transcription, is acetylated. TFIIB is also an autoacetyltransferase, although it shares no sequence homology with any known acetyltransferases. In the absence of other enzymes, it binds acetyl-coenzyme A (acetyl-CoA), and catalyses the transfer of the acetyl group onto a specific lysine residue (K238). Both recombinant and cellular TFIIB can autoacetylate, markedly stabilizing the interaction between TFIIB and transcription factor TFIIF and activating transcription in vitro and in cells. A K238A mutant, which cannot be autoacetylated, does not show this activation of transcription. Our findings suggest that there is a regulatory pathway controlling acetylation of TFIIB, and they link acetyl-CoA with basal gene transcription.