In the present study we show the existence of a functional nitric oxide synthase (NOS) in rat liver mitochondria. The enzyme uses L-arginine (L-arg) to produce nitric oxide (NO) and L-citrulline, and is Ca2+-dependent. L-Arg analogues, N(omega)monomethyl-L-arg and N(omega)-nitro-L-arg, inhibit the enzyme, and D-arginine is not a substrate for it. We found mitochondrial NOS (mtNOS) activity associated with the inner mitochondrial membrane but not with the matrix fraction. In intact, succinate-energized mitochondria, the enzyme is constitutively active and exerts substantial control over mitochondrial respiration and membrane potential. The activity is further stimulated when Ca2+ is taken up by mitochondria. We suggest that the existence of mtNOS and its Ca2+ dependence are highly relevant for mitochondrial functioning.