Photolyzed rhodopsin acts in a catalytic manner to mediate the exchange of GTP for GDP bound to transducin. We have analyzed the steady-state kinetics of this activation process in order to determine the molecular mechanism of interactions between rhodopsin, transducin, and guanine nucleotides. Initial velocities (Vo) of the exchange reaction catalyzed by rhodopsin were measured for various transducin concentrations at several fixed levels of the GTP analog, [35S]guanosine 5'-(3-O-thio)triphosphate (GTP gamma S). The initial rate data analysis rigorously demonstrates that rhodopsin mediates the activation of transducin by a double-displacement catalytic mechanism. The Michaelis-Menten curves determined as a function of [transducin] reveal remarkable allosteric behavior; analysis of this data yields a Hill coefficient of 2. Lineweaver-Burk plots of Vo-1 versus [transducin]-1 display curvilinearity indicative of positive cooperativity and a series of parallel lines are generated by plotting Vo-1 as a function of [transducin]-2. The plots of Vo-1 versus [GTP gamma S]-1 show no evidence of allosterism and are a parallel series. Furthermore, the allosteric behavior observed in the activation of transducin is also witnessed in the rhodopsin-catalyzed guanine nucleotide exchange of the G protein's purified alpha subunit in the absence of the beta X gamma subunit complex. The latter observation implies that the molecular basis for allosterism in the activation process resides in the interactions between the photoreceptor and transducin's alpha subunit.