Direct observation of transcription factor action in the living cell nucleus can provide important insights into gene regulatory mechanisms. Live-cell imaging techniques have enabled the visualization of a variety of intranuclear activities, from chromosome dynamics to gene expression. However, progress in studying transcription regulation of specific native genes has been limited, primarily as a result of difficulties in resolving individual gene loci and in detecting the small number of protein molecules functioning within active transcription units. Here we report that multiphoton microscopy imaging of polytene nuclei in living Drosophila salivary glands allows real-time analysis of transcription factor recruitment and exchange on specific native genes. After heat shock, we have visualized the recruitment of RNA polymerase II (Pol II) to native hsp70 gene loci 87A and 87C in real time. We show that heat shock factor (HSF), the transcription activator of hsp70, is localized to the nucleus before heat shock and translocates from nucleoplasm to chromosomal loci after heat shock. Assays based on fluorescence recovery after photobleaching show a rapid exchange of HSF at chromosomal loci under non-heat-shock conditions but a very slow exchange after heat shock. However, this is not a consequence of a change of HSF diffusibility, as shown here directly by fluorescence correlation spectroscopy. Our results provide strong evidence that activated HSF is stably bound to DNA in vivo and that turnover or disassembly of transcription activator is not required for rounds of hsp70 transcription. This and previous studies indicate that transcription activators display diverse dynamic behaviours in their associations with targeted loci in living cells. Our method can be applied to study the dynamics of many factors involved in transcription and RNA processing, and in their regulation at native heat shock genes in vivo.