Metal cofactors (Mg2+ and Mn2+) modulate both specific DNA binding and strand cleavage in the TaqI endonuclease (Cao, W., Mayer, A. N., and Barany, F. (1995) Biochemistry 34, 2276-2283). This work attempts to establish the structural basis of TaqI-DNA-metal2+ interactions using an affinity cleavage technique. The protein was cleaved by localized hydroxyl radicals generated by oxidizing Fe2+ within the metal binding sites. Cleavage fragments were separated by SDS-polyacrylamide gel electrophoresis, and cleavage sites were determined using micropeptide sequencing. Eleven amino acid residues in the vicinity of cleavage sites were selected for site-directed mutagenesis. The negative charge at Asp137 is essential for DNA cleavage but not required for sequence specific binding. Mutations at Asp142 abolish both specific binding and catalysis, except for D142E, which converts TaqI into a completely Mn2+-dependent endonuclease. The positive charge at Lys158 appears to be important for both specific binding and catalysis. Mutations at other sites affect binding and/or catalysis to different degrees, except Trp113 and Glu135, which appear to be nonessential for the TaqI enzyme activity. The critical residues for TaqI function are distinct from the PDX14-20(E/D)XK catalytic motif elucidated from other endonucleases.