Cyanidioschyzon merolae is a unicellular red alga living in acid hot springs, which is able to grow on ammonium, as well as nitrate as sole nitrogen source. Based on the complete genome sequence, proteins for nitrate utilization, nitrate transporter (NRT) and nitrate reductase (NR), were predicted to be encoded by the neighboring nuclear genes CMG018C and CMG019C, respectively, but no typical nitrite reductase (NiR) gene was found by similarity searches. On the other hand, two candidate genes for sulfite reductase (SiR) were found, one of which (CMG021C) is located next to the above-noted nitrate-related genes. Given that transcripts of CMG018C, CMG019C and CMG021C accumulate in nitrate-containing media, but are repressed by ammonium, and that SiR and NiR are structurally related enzymes, we hypothesized that the CMG021C gene product functions as an NiR in C. merolae. To test this hypothesis, we developed a method for targeted gene disruption in C. merolae. In support of our hypothesis, we found that a CMG021G null mutant in comparison with the parental strain showed decreased cell growth in nitrate-containing but not in ammonium-containing media. Furthermore, expression of CMG021C in the nirA mutant of a cyanobacterium, Leptolyngbya boryana (formerly Plectonema boryanum), could genetically complement the NiR defect. Immunofluorescent analysis indicated the localization of CMG021C in chloroplasts, and hence we propose an overall scheme for nitrate assimilation in C. merolae.