Maintaining high transcriptional fidelity is essential to life. For all eukaryotic organisms, RNA polymerase II (Pol II) is responsible for messenger RNA synthesis from the DNA template. Three key checkpoint steps are important in controlling Pol II transcriptional fidelity: nucleotide selection and incorporation, RNA transcript extension, and proofreading. Some types of DNA damage significantly reduce transcriptional fidelity. However, the chemical interactions governing each individual checkpoint step of Pol II transcriptional fidelity and the molecular basis of how subtle DNA base damage leads to significant losses of transcriptional fidelity are not fully understood. Here we use a series of "hydrogen bond deficient" nucleoside analogues to dissect chemical interactions governing Pol II transcriptional fidelity. We find that whereas hydrogen bonds between a Watson-Crick base pair of template DNA and incoming NTP are critical for efficient incorporation, they are not required for efficient transcript extension from this matched 3'-RNA end. In sharp contrast, the fidelity of extension is strongly dependent on the discrimination of an incorrect pattern of hydrogen bonds. We show that U:T wobble base interactions are critical to prevent extension of this mismatch by Pol II. Additionally, both hydrogen bonding and base stacking play important roles in controlling Pol II proofreading activity. Strong base stacking at the 3'-RNA terminus can compensate for loss of hydrogen bonds. Finally, we show that Pol II can distinguish very subtle size differences in template bases. The current work provides the first systematic evaluation of electrostatic and steric effects in controlling Pol II transcriptional fidelity.