The σ subunit of bacterial RNA polymerase (RNAP) controls recognition of the -10 and -35 promoter elements during transcription initiation. Free σ adopts a "closed," or inactive, conformation incompatible with promoter binding. The conventional two-state model of σ activation proposes that binding to core RNAP induces formation of an "open," active, σ conformation, which is optimal for promoter recognition. Using single-molecule Förster resonance energy transfer, we demonstrate that vegetative-type σ subunits exist in open and closed states even after binding to the RNAP core. As an extreme case, RNAP from Mycobacterium tuberculosis preferentially retains σ in the closed conformation, which is converted to the open conformation only upon binding by the activator protein RbpA and interaction with promoter DNA. These findings reveal that the conformational dynamics of the σ subunit in the RNAP holoenzyme is a target for regulation by transcription factors and plays a critical role in promoter recognition.