The transcription factor TFIIA is encoded by two genes, TFIIAalphabeta and TFIIAgamma. In higher eukaryotes, the TFIIAalphabeta is translated as a precursor and undergoes proteolytic cleavage; the regulation and biological implications of the cleavage have remained elusive. We determined by Edman degradation that the TFIIAbeta subunit starts at Asp 278. We found that a cleavage recognition site (CRS), a string of amino acids QVDG at positions -6 to -3 from Asp 278, is essential for cleavage. Mutations in the CRS that prevent cleavage significantly prolong the half-life of TFIIA. Consistently, the cleaved TFIIA is a substrate for the ubiquitin pathway and proteasome-mediated degradation. We show that mutations in the putative phosphorylation sites of TFIIAbeta greatly affect degradation of the beta-subunit. We propose that cleavage and subsequent degradation fine-tune the amount of TFIIA in the cell and consequently the level of transcription.