The crystal structure analysis of the Fe-type nitrile hydratase from Rhodococcus sp. N-771 revealed the unique structure of the enzyme composed of the alpha- and beta-subunits and the unprecedented structure of the non-heme iron active center [Nagashima, S., et al. (1998) Nat. Struct. Biol. 5, 347-351]. A number of hydration water molecules were identified both in the interior and at the exterior of the enzyme. The study presented here investigated the roles of the hydration water molecules in stabilizing the tertiary and the quaternary structures of the enzyme, based on the crystal structure and the results from a laser light scattering experiment for the enzyme in solution. Seventy-six hydration water molecules between the two subunits significantly contribute to the alphabeta heterodimer formation by making up the surface shape, forming extensive networks of hydrogen bonds, and moderating the surface charge of the beta-subunit. In particular, 20 hydration water molecules form the extensive networks of hydrogen bonds stabilizing the unique structure of the active center. The amino acid residues hydrogen-bonded to those hydration water molecules are highly conserved among all known nitrile hydratases and even in the homologous enzyme, thiocyanate hydrolase, suggesting the structural conservation of the water molecules in the NHase family. The crystallographic asymmetric unit contained two heterodimers connected by 50 hydration water molecules. The heterotetramer formation in crystallization was clearly explained by the concentration-dependent aggregation state of NHase found in the light scattering measurement. The measurement proved that the dimer-tetramer equilibrium shifted toward the heterotetramer dominant state in the concentration range of 10(-2)-1.0 mg/mL. In the tetramer dominant state, 50 water molecules likely glue the two heterodimers together as observed in the crystal structure. Because NHase exhibits a high abundance in bacterial cells, the result suggests that the heterotetramer is physiologically relevant. In addition, it was revealed that the substrate specificity of this enzyme, recognizing small aliphatic substrates rather than aromatic ones, came from the narrowness of the entrance channel from the bulk solvent to the active center. This finding may give a clue for changing the substrate specificity of the enzyme. Under the crystallization condition described here, one 1,4-dioxane molecule plugged the channel. Through spectroscopic and crystallographic experiments, we found that the molecule prevented the dissociation of the endogenous NO molecule from the active center even when the crystal was exposed to light.