The transcription of iron uptake and storage genes in Saccharomyces cerevisiae is primarily regulated by the transcription factor Aft1. Nucleocytoplasmic shuttling of Aft1 is dependent upon mitochondrial Fe-S cluster biosynthesis via a signaling pathway that includes the cytosolic monothiol glutaredoxins (Grx3 and Grx4) and the BolA homologue Fra2. However, the interactions between these proteins and the iron-dependent mechanism by which they control Aft1 localization are unclear. To reconstitute and characterize components of this signaling pathway in vitro, we have overexpressed yeast Fra2 and Grx3/4 in Escherichia coli. We have shown that coexpression of recombinant Fra2 with Grx3 or Grx4 allows purification of a stable [2Fe-2S](2+) cluster-containing Fra2-Grx3 or Fra2-Grx4 heterodimeric complex. Reconstitution of a [2Fe-2S] cluster on Grx3 or Grx4 without Fra2 produces a [2Fe-2S]-bridged homodimer. UV-visible absorption and CD, resonance Raman, EPR, ENDOR, Mossbauer, and EXAFS studies of [2Fe-2S] Grx3/4 homodimers and the [2Fe-2S] Fra2-Grx3/4 heterodimers indicate that inclusion of Fra2 in the Grx3/4 Fe-S complex causes a change in the cluster stability and coordination environment. Taken together, our analytical, spectroscopic, and mutagenesis data indicate that Grx3/4 and Fra2 form a Fe-S-bridged heterodimeric complex with Fe ligands provided by the active site cysteine of Grx3/4, glutathione, and a histidine residue. Overall, these results suggest that the ability of the Fra2-Grx3/4 complex to assemble a [2Fe-2S] cluster may act as a signal to control the iron regulon in response to cellular iron status in yeast.