The vitamin D receptor (VDR) belongs to the thyroid hormone/retinoid receptor subfamily of nuclear receptors and functions as a heterodimer with retinoid X receptor (RXR). The RXR-VDR heterodimer, in contrast to other members of the class II nuclear receptor subfamily, is nonpermissive where RXR does not bind its cognate ligand, and therefore its role in VDR-mediated transactivation by liganded RXR-VDR has not been fully characterized. Here, we show a unique facet of the intermolecular RXR-VDR interaction, in which RXR actively participates in vitamin D3-dependent gene transcription. Using helix 3 and helix 12 mutants of VDR and RXR, we provide functional evidence that liganded VDR allosterically modifies RXR from an apo (unliganded)- to a holo (liganded)-receptor conformation, in the absence of RXR ligand. As a result of the proposed allosteric modification of RXR by liganded VDR, the heterodimerized RXR shows the "phantom ligand effect" and thus acquires the capability to recruit coactivators steroid receptor coactivator 1, transcriptional intermediary factor 2, and amplified in breast cancer-1. Finally, using a biochemical approach with purified proteins, we show that RXR augments the 1,25-dihydroxyvitamin D3-dependent recruitment of transcriptional intermediary factor 2 in the context of RXR-VDR heterodimer. These results confirm and extend the previous observations suggesting that RXR is a significant contributor to VDR-mediated gene expression and provide a mechanism by which RXR acts as a major contributor to vitamin D3-dependent transcription.