Chloramphenicol activates translation of cat-86 mRNA by stalling a ribosome in the leader of individual transcripts. Stalling triggers two sequential events: the destabilization of a region of secondary structure that sequesters the cat ribosome-binding site (RBS-C), and the initiation of cat translation. The site of drug-dependent ribosome stalling is dictated by the leader sequence, crb; crb causes a ribosome to stall with its aminoacyl site at leader codon 6. We demonstrate that induction requires the maintenance of a precise spatial relationship between crb and sequences within the left inverted repeat of the secondary structure. Therefore, destabilization of the secondary structure during chloramphenicol induction may result from the interaction of a stalled ribosome with a specific sequence in the secondary structure rather than from non-specific masking of RNA sequences. cat-86 regulation also depends on the distance that separates crb from RBS-C. This interval of 33 nucleotides was incrementally increased and decreased by mutations within a loop in the secondary structure. Shortening the distance between crb and RBS-C by three nucleotides reduced induction by half and a deletion of nine nucleotides abolished induction. Insertion mutations were without effect on induced expression but elevated basal expression. The results indicate that when the A site of a ribosome occupies leader codon 6 the secondary structure is destabilized and there is no interference with entry of a second ribosome at RBS-C. The data further demonstrate that when the A site of a ribosome in the leader is within 30 nucleotides of RBS-C, cat expression decreases. This decrease probably results from competition of the leader ribosome with the ribosome initiating cat translation. Our observations demonstrate that in wild-type cat-86 the distances between crb and the secondary structure, and between crb and RBS-C provide the precise spacing necessary to achieve three interdependent effects: the destabilization of the RNA secondary structure by a ribosome stalled at crb; a lack of competition between a ribosome stalled at crb and the initiating ribosome; and maintenance of a low, but measurable, basal level of cat expression. The spatial relationships identified as necessary for the regulation of cat-86 are conserved in the regulatory regions for five other inducible cat genes.