The chemical mechanism by which ATP synthases catalyze the synthesis of ATP remains unknown despite the recent elucidation of the three-dimensional structures of two forms of the F(1) catalytic sector (subunit stoichiometry, alpha(3)beta(3)gammadeltaepsilon). Lacking is critical information about the chemical events taking place at the catalytic site of each beta-subunit in the transition state. In an earlier report (Ko, Y. H., Bianchet, M. A., Amzel, L.M., and Pedersen, P. L. (1997) J. Biol. Chem. 272, 18875-18881), we provided evidence for transition state formation in the presence of Mg(2+), ADP, and orthovanadate (V(i)), a photoreactive phosphate analog with a trigonal bipyramidal geometry resembling that of the gamma-P of ATP in the transition state of enzymes like myosin. In the presence of ultraviolet light and O(2,) the MgADP.V(i)-F(1) complex was cleaved within the P-loop (GGAGVGKT) of a single beta-subunit at alanine 158, implicating this residue as within contact distance of the gamma-P of ATP in the transition state. Here, we report that ADP, although facilitating transition state formation, is not essential. In the presence of Mg(2+) and V(i) alone the catalytic activity of the resultant MgV(i)-F(1) complex is inhibited to nearly the same extent as that observed for the MgADP. V(i)-F(1) complex. Inhibition is not observed with ADP, Mg(2+), or V(i) alone. Significantly, in the presence of ultraviolet light and O(2,) the MgV(i)-F(1) complex is cleaved also within the P-loop of a single beta-subunit at alanine 158 as confirmed by Western blot analyses with two different antibodies, by N-terminal sequence analyses, and by quantification of the amount of unreacted beta-subunits. These novel findings indicate that Mg(2+) plays a pivotal role in transition state formation during ATP synthesis catalyzed by ATP synthases, a role that involves both its preferential coordination with P(i) and the repositioning of the P-loop to bring the nonpolar alanine 158 into the catalytic pocket. A reaction scheme for ATP synthases depicting a role for Mg(2+) in transition state formation is proposed here for the first time.