Transcription regulation is a fundamental biological process, and extensive efforts have been made to dissect its mechanisms through direct biological experiments and regulation modeling based on physical-chemical principles and mathematical formulations. Despite these efforts, transcription regulation is yet not well understood because of its complexity and limitations in biological experiments. Recent advances in high throughput technologies have provided substantial amounts and diverse types of genomic data that reveal valuable information on transcription regulation, including DNA sequence data, protein-DNA binding data, microarray gene expression data, and others. In this article, we propose a Bayesian error analysis model to integrate protein-DNA binding data and gene expression data to reconstruct transcriptional regulatory networks. There are two unique aspects to this proposed model. First, transcription is modeled as a set of biochemical reactions, and a linear system model with clear biological interpretation is developed. Second, measurement errors in both protein-DNA binding data and gene expression data are explicitly considered in a Bayesian hierarchical model framework. Model parameters are inferred through Markov chain Monte Carlo. The usefulness of this approach is demonstrated through its application to infer transcriptional regulatory networks in the yeast cell cycle.