The promoter selectivity factor Sp1 often cooperates with other enhancer-binding proteins to activate transcription. To study the molecular underpinnings of these regulatory events, we have reconstituted in vitro the synergy observed in vivo between Sp1 and the sterol-regulated factor SREBP-1a at the low density lipoprotein receptor (LDLR) promoter. Using a highly purified human transcription system, we found that chromatin, TAFs, and a novel SREBP-binding coactivator activity, which includes CBP, are all required to mediate full synergistic activation by Sp1 and SREBP-1a. The SREBP-binding domain of CBP inhibits activation by SREBP-1a and Sp1 in a dominant-negative fashion that is both chromatin- and activator-specific. Whereas recombinant CBP alone is not sufficient to mediate activation, a human cellular fraction containing CBP can support high levels of chromatin-dependent synergistic activation. Purification of this activity to near homogeneity resulted in the identification of a multiprotein coactivator, including CBP, that selectively binds to the SREBP-1a activation domain and is capable of mediating high levels of synergistic activation by SREBP/Sp1 on chromatin templates. The development of a reconstituted chromatin transcription system has allowed us to isolate a novel coactivator that is recruited by the SREBP-1a activation domain and that functions in concert with TFIID to coordinate the action of multiple activators at complex promoters in the context of chromatin.