RNA polymerase II (RNA pol II) is a multisubunit enzyme that requires many auxiliary factors for its activity. Over the years, these factors have been identified using both biochemical and genetic approaches. Recently, the systematic characterization of protein complexes by tandem affinity purification and mass spectroscopy has allowed the identification of new components of well established complexes, including the RNA pol II holoenzyme. Using this approach, a novel and highly conserved factor, Iwr1p, that physically interacts with most of the RNA pol II subunits has been described in yeast. Here we show that Iwr1p genetically interacts with components of the basal transcription machinery and plays a role in both basal and regulated transcription. We report that mutation of the IWR1 gene is able to bypass the otherwise essential requirement for the transcriptional regulator negative cofactor 2, which occurs with different components of the basal transcription machinery, including TFIIA and subunits of the mediator complex. Deletion of the IWR1 gene leads to an altered expression of specific genes, including phosphate-responsive genes and SUC2. Our results show that Iwr1p is a nucleocytoplasmic shuttling protein and suggest that Iwr1p acts early in the formation of the pre-initiation complex by mediating the interaction of certain activators with the basal transcription apparatus.