Basal transcription factor TFIID comprises the TATA‐box‐binding protein, TBP, and associated factors, the TAFIIs. Previous studies have implicated TAFII250 and TAFII150 in core promoter selectivity of RNA polymerase II. Here, we have used a random DNA binding site selection procedure to identify target sequences for these TAFs. Individually, neither TAFII250 nor TAFII150 singles out a clearly constrained DNA sequence. However, a TAFII250–TAFII150 complex selects sequences that match the Initiator (Inr) consensus. When in a trimeric complex with TBP, these TAFs select Inr sequences at the appropriate distance from the TATA‐box. Point mutations that inhibit binding of the TAFII250–TAFII150 complex also impair Inr function in reconstituted basal transcription reactions, underscoring the functional relevance of Inr recognition by TAFs. Surprisingly, the precise DNA sequence at the start site of transcription influences transcriptional regulation by the upstream activator Sp1. Finally, we found that TAFII150 specifically binds to four‐way junction DNA, suggesting that promoter binding by TFIID may involve recognition of DNA structure as well as primary sequence. Taken together, our results establish that TAFII250 and TAFII150 bind the Inr directly and that Inr recognition can determine the responsiveness of a promoter to an activator