Though many of the proteins and protein complexes involved in eukaryotic gene expression have been identified, mechanistic knowledge about how the proteins interact with and influence one another to promote gene expression remains limited. In this work, we have started to tease out the effects of an activator protein and the chromatin environment on the HAT activity of the SAGA complex. In contrast to the prevailing model of stimulation in which activator was believed to increase the binding affinity of SAGA for chromatin, we observed that activator increases the turnover rate of acetylation by SAGA on chromatin substrates. We have determined that this stimulation is dependent on (1) the binding of activator to its consensus sequence in the flanking DNA of a target nucleosome, (2) the ability of SAGA to compete for nucleosome binding with non-specific activator binding, and (3) the interaction of activator with the Tra1 subunit of SAGA. We have further analyzed the effects of activator on another HAT complex, the poorly-characterized ADA complex. Additionally, we have characterized the influence of nucleosome flanking DNA on the HAT activity of SAGA; the presence of flanking DNA stimulates HAT activity by increasing both binding affinity and turnover rate. Altogether, the work presented here suggests a model where SAGA binds to and acetylates nucleosomes inefficiently until it interacts with DNA-bound activators or exposed nucleosome flanking DNA near gene promoters. The interaction between activator or DNA and SAGA stimulates its HAT activity, thereby generating localized regions of hyperacetylation at gene promoters.