The heterodimeric complex SPT4/SPT5 is a transcript elongation factor (TEF) that directly interacts with RNA polymerase II (RNAPII) to regulate messenger RNA synthesis in the chromatin context. We provide biochemical evidence that in Arabidopsis, SPT4 occurs in a complex with SPT5, demonstrating that the SPT4/SPT5 complex is conserved in plants. Each subunit is encoded by two genes SPT4-1/2 and SPT5-1/2. A mutant affected in the tissue-specifically expressed SPT5-1 is viable, whereas inactivation of the generally expressed SPT5-2 is homozygous lethal. RNAi-mediated downregulation of SPT4 decreases cell proliferation and causes growth reduction and developmental defects. These plants display especially auxin signalling phenotypes. Consistently, auxin-related genes, most strikingly AUX/IAA genes, are downregulated in SPT4-RNAi plants that exhibit an enhanced auxin response. In Arabidopsis nuclei, SPT5 clearly localizes to the transcriptionally active euchromatin, and essentially co-localizes with transcribing RNAPII. Typical for TEFs, SPT5 is found over the entire transcription unit of RNAPII-transcribed genes. In SPT4-RNAi plants, elevated levels of RNAPII and SPT5 are detected within transcribed regions (including those of downregulated genes), indicating transcript elongation defects in these plants. Therefore, SPT4/SPT5 acts as a TEF in Arabidopsis, regulating transcription during the elongation stage with particular impact on the expression of certain auxin-related genes.