Cellular messenger RNA levels are achieved by the combinatorial complexity of factors controlling transcription, yet the small number of molecules involved in these pathways fluctuates stochastically. It has not yet been experimentally possible to observe the activity of single polymerases on an endogenous gene to elucidate how these events occur in vivo. Here, we describe a method of fluctuation analysis of fluorescently labeled RNA to measure dynamics of nascent RNA--including initiation, elongation, and termination--at an active yeast locus. We find no transcriptional memory between initiation events, and elongation speed can vary by threefold throughout the cell cycle. By measuring the abundance and intranuclear mobility of an upstream transcription factor, we observe that the gene firing rate is directly determined by trans-activating factor search times.