While enhancers, essential for gene regulation and organism development, have been extensively studied, particularly regarding the mechanisms underlying how enhancers initiate transcription at the target genes. However, the spatiotemporal information of enhancer-mediated interactions remains unclear, especially within complex gene environments. Using quantitative live imaging in early Drosophila embryos, we explored the dynamics of enhancer-promoter interactions and their impact on gene expression, revealing several key findings. First, we observed that each reporter gene experienced a reduction in transcription in homozygotes when driven by strong enhancer-promoter interactions, which suggested a competitive relationship between homologous genes. By dissecting the homologous regulatory unit into “enhancer only” and “promoter only” constructs, we demonstrated that the interallelic competition persists in both genotypes, indicating that the limiting transcription machinery can be RNA polymerase II and pre-initiation complex molecules that bind to both enhancer and promoter regions. Second, we investigated spatiotemporal thresholds of transcription initiation and found that the enhancer had to be less than 500 nm away from its target promoter for longer than four minutes to initiate transcription. The precise spatiotemporal requirement highlights the importance of sustained proximity in gene activation and sheds insights into achieving precise gene control. In both studies, evidence supports the hypothesis that transcription hubs form at the regulatory elements, facilitating transcription with a local concentration of transcription machinery. These findings significantly advance our understanding of the dynamics of enhancer-promoter interplay and gene regulation at the single-cell level. The knowledge gained from these studies serves as a stepping stone toward achieving precise gene control in various biological contexts, from developmental processes to potential therapeutic applications.