A mutant T7 RNA polymerase (T7 RNAP) having two amino-acid substitutions (Y639F and S641A) is altered in its specificity towards nucleotide substrates, but is not affected in the specificity of its interaction with promoter and terminator sequences. The mutant enzyme gains the ability to utilize dNTPs and catalyze RNA and DNA synthesis from circular supercoiled plasmid DNA. DNA synthesis can also be initiated from a single stranded template using a DNA primer. Another T7 RNAP mutant having only the single substitution S641A loses RNA polymerase activity but is able to synthesize DNA.