In Escherichia coli, translocation of RNA polymerase (RNAP) during transcription introduces supercoiling to DNA, which influences the initiation and elongation behaviors of RNAP. To quantify the role of supercoiling in transcription regulation, we developed a spatially resolved supercoiling model of transcription. The integrated model describes how RNAP activity feeds back with the local DNA supercoiling and how this mechanochemical feedback controls transcription, subject to topoisomerase activities and stochastic topological domain formation. This model establishes that transcription-induced supercoiling mediates the cooperation of co-transcribing RNAP molecules in highly expressed genes, and this cooperation is achieved under moderate supercoiling diffusion and high topoisomerase unbinding rates. It predicts that a topological domain could serve as a transcription regulator, generating substantial transcriptional noise. It also shows the relative orientation of two closely arranged genes plays an important role in regulating their transcription. The model provides a quantitative platform for investigating how genome organization impacts transcription.