Expression of the upp gene of Escherichia coli, which encodes the pyrimidine salvage enzyme uracil phosphoribosyltransferase, is negatively regulated by pyrimidine availability. In this study, we demonstrate that this regulation occurs mainly by UTP-sensitive selection of alternative transcriptional start sites, which produces transcripts that differ in the ability to be productively elongated. The upp initially transcribed region contains the sequence GATTTTTTTTG (nontemplate strand). Transcription is initiated primarily at the first two bases in this sequence, designated G6 and A7 (counting from the promoter -10 region). High intracellular levels of UTP favor initiation at position A7; however, the resulting transcripts are subject to reiterative transcription (i.e., repetitive nucleotide addition) within the run of T residues in the initially transcribed region. The resulting AUUUUn (where n = 1 to >50) transcripts are not extended to include downstream upp sequences. In contrast, low intracellular levels of UTP strongly favor initiation at position G6, which results in transcripts that generally do not engage in reiterative transcription and thus can be normally elongated. This mechanism ensures that high levels of uracil phosphoribosyltransferase are produced only under conditions of pyrimidine limitation. The mechanisms that account for UTP-sensitive start site selection and different fates of upp transcripts, as well as the general use of UTP-dependent reiterative transcription in gene regulation, are discussed in detail.