Over the past few years, advances in biochemical and genetic studies of the structure and function of the Mediator complex have shed new light on its subunit architecture and its mechanism of action in transcription by RNA polymerase II (pol II). The development of improved methods for reconstitution of recombinant Mediator subassemblies is enabling more in-depth analyses of basic features of the mechanisms by which Mediator interacts with and controls the activity of pol II and the general initiation factors. The discovery and characterization of multiple, functionally distinct forms of Mediator characterized by the presence or absence of the Cdk8 kinase module have led to new insights into how Mediator functions in both Pol II transcription activation and repression. Finally, progress in studies of the mechanisms by which the transcriptional activation domains (ADs) of DNA binding transcription factors target Mediator have brought to light unexpected complexities in the way Mediator participates in signal transduction.