Galactose-1-phosphate uridylyltransferase (GalT) catalyzes the reversible transformation of uridine 5'-diphosphate glucose (UDPGlc) and galactose-1-phosphate into uridine 5'-diphosphate galactose (UDPGal) and glucose-1-phosphate through a double displacement mechanism, with the intermediate formation of a covalent uridylyl-enzyme (UMP-enzyme). The covalent linkage is a phosphoramidate formed between the UMP moiety and the His 166 N(epsilon)(2) of GalT, with His 166 N(delta1) retaining a proton throughout the catalytic cycle. Cys 160 and Ser 161 in Escherichia coli GalT are engaged in hydrogen bonding with the peripheral phosphoryl oxygen atoms of the substrate in the crystalline UMP-enzyme and in the crystalline complex of H166G-GalT with UDPGlc [Wedekind, J. E., Frey, P. A., and Rayment, I. (1996) Biochemistry 35, 11560-11569; Thoden, J. B., Ruzicka, F. J., Frey, P. A., Rayment, I., and Holden, H. M. (1997) Biochemistry 36, 1212-1222]. Site-directed mutagenesis, thermodynamic, transient kinetic, and steady-state kinetic studies have been performed to investigate the roles of Cys 160 and Ser 161 in catalysis. The absence of the thiol group of Cys 160 in the variants C160S and C160A did not seriously alter the enzymatic activity. However, the variant S161A displayed 7000-fold less activity than wild-type GalT. The low activity of S161A was directly related to impaired uridylylation rate constant (3.7 x 10(-)(2) s(-)(1)) and de-uridylylation rate constant (0.5 x 10(-)(2) s(-)(1)) resulting from a higher kinetic barrier for uridylyl-group transfer by the variant S161A as compared with the wild-type GalT. Equilibrium uridylylation studies showed that neither Cys 160 nor Ser 161 was involved in stabilizing the uridylyl-enzyme intermediate. The results lead to the conclusion that the conserved Cys 160 does not play a critical role in catalysis. Ser 161 is most likely involved in donating a hydrogen bond to the beta-phosphoryl group of a substrate, thereby providing proper orientation for nucleophilic catalysis.