The synthesis of acetyl-CoA from CO2, H2, and various C1 compounds was studied in vitro with extracts and with protein fractions of Methanobacterium thermoautotrophicum. Acetyl-CoA synthesis from CO2 and H2 by extracts required CO2 reduction to CH4 to proceed. Both processes were highly stimulated by formaldehyde which served as the carbon precursor of both CH4 and the CH3 group of acetate. Carbon monoxide in combination with formaldehyde dramatically stimulated the acetyl-CoA synthesis up to 150-fold. In this system, which did not require CO2 reduction to the formaldehyde and CO level, acetyl-CoA synthesis was no longer dependent on CH4 formation. The soluble (100,000 X g supernatant) cell protein was resolved into a protein fraction [45-60% (NH4)2SO4-fraction] which catalyzed acetyl-CoA synthesis at a specific rate of 15 nmol X min-1 X (equivalent of mg cell protein)-1 (60 degrees C). This oxygen-sensitive enzyme reaction required dithioerythritol for activity and was strictly dependent on coenzyme A, CO, and N5,N10-methylene tetrahydromethanopterin, N5-methyl tetrahydromethanopterin or formaldehyde plus tetrahydromethanopterin. The incorporation of formaldehyde is explained by the spontaneous formation of methylene tetrahydromethanopterin. The product of the reaction, acetyl-CoA, was quantitatively derived from CO (carboxyl of acetate) and a C1 derivative of tetrahydromethanopterin (methyl of acetate). The C1 derivative of tetrahydromethanopterin could not be replaced by a C1 derivative of tetrahydrofolate or by methyl-coenzyme M; ATP was not required. The active protein fraction contained CO dehydrogenase and at least on corrinoid protein. These results provide strong biochemical arguments for the proposed mechanism of autotrophic acetyl-CoA synthesis in Methanobacterium.