Numerous target genes of the Polycomb group (PcG) are transiently activated by a stimulus and subsequently repressed. However, mechanisms by which PcG proteins regulate such target genes remain elusive. We employed the heat shock-responsive hsp70 locus in Drosophila to study the chromatin dynamics of PRC1 and its interplay with known regulators of the locus before, during and after heat shock. We detected mutually exclusive binding patterns for HSF and PRC1 at the hsp70 locus. We found that Pleiohomeotic (Pho), a DNA-binding PcG member, dynamically interacts with Spt5, an elongation factor. The dynamic interaction switch between Pho and Spt5 is triggered by the recruitment of HSF to chromatin. Mutation in the protein-protein interaction domain (REPO domain) of Pho interferes with the dynamics of its interaction with Spt5. The transcriptional kinetics of the heat shock response is negatively affected by a mutation in the REPO domain of Pho. We propose that a dynamic interaction switch between PcG proteins and an elongation factor enables stress-inducible genes to efficiently switch between ON/OFF states in the presence/absence of the activating stimulus.