Transcription initiation at the  P promoter occurs in the presence of high arabinose and low glucose concentrations. Upon arabinose binding to AraC, the N-terminal arm of AraC is released from its DNA binding domain via a “light switch” mechanism. This allows AraC to dimerize and bind the I and I operators. The AraC-arabinose dimer at this site contributes to activation of the Ppromoter. Additionally, CAP binds to two CAP binding sites upstream of the I and I operators and helps activate the P promoter. In the presence of both high arabinose and high glucose concentrations however, low cAMP levels prevent CAP from activating the P promoter.  It is hypothesized that P promoter activation by CAP and AraC is mediated through contacts between the C-terminal domain of the α-subunit of RNA polymerase and the CAP and AraC proteins.
Without arabinose, and regardless of glucose concentration, the P and Ppromoters are repressed by AraC. The N-terminal arm of AraC interacts with its DNA binding domain, allowing two AraC proteins to bind to the O and I operator sites. The Ooperator is situated within the araC  gene. An AraC dimer also binds to the O operator and represses the P promoter via a negative autoregulatory feedback loop. The two bound AraC proteins dimerize and cause looping of the DNA. The looping prevents binding of CAP and RNA Polymerase, which normally activate the transcription of both P and P.
The spacing between the O and I operator sites is critical. Adding or removing 5 base pairs between the O and I operator sites abrogates AraC mediated repression of the P promoter. The spacing requirement arises from the double helix nature of DNA, in which a complete turn of the helix is about 10.5 nucleotides. Therefore, adding or removing 5 base pairs between the O and I operator sites rotates the helix roughly 180 degrees. This reverses the direction that the Ooperator faces when the DNA is looped and prevents dimerization of the O bound AraC with the bound I araC.