Myotonic dystrophy type 1 (DM1) is caused by a CUG_n expansion (n ≈ 50 to 5000) in the 3′ untranslated region of the mRNA of the DM protein kinase gene. We show that mutant RNA binds and sequesters transcription factors (TFs), with up to 90% depletion of selected TFs from active chromatin. Diverse genes are consequently reduced in expression, including the ion transporter CIC-1, which has been implicated in myotonia. When TF specificity protein 1 (Sp1) was overexpressed in DM1-affected cells, low levels of messenger RNA for CIC-1 were restored to normal. Transcription factor leaching from chromatin by mutant RNA provides a potentially unifying pathomechanistic explanation for this disease.