In Azotobacter vinelandii, activation of nif gene expression by the transcriptional regulatory enhancer binding protein NIFA is controlled by the sensor protein NIFL in response to changes in levels of oxygen and fixed nitrogen in vivo. NIFL is a novel redox-sensing flavoprotein which is also responsive to adenosine nucleotides in vitro. Inhibition of NIFA activity by NIFL requires stoichiometric amounts of the two proteins, implying that the mechanism of inhibition is by direct protein-protein interaction rather than by catalytic modification of the NIFA protein. The formation of the inhibitory complex between NIFL and NIFA may be regulated by the intracellular ATP/ADP ratio. We show that adenosine nucleotides promote complex formation between purified NIFA and NIFL in vitro, allowing isolation of the NIFL-NIFA complex. The complex can also be isolated from cell extracts containing coexpressed NIFL and NIFA in the presence of MgADP. Removal of the nucleotide causes dissociation of the complex. Experiments with truncated proteins demonstrate that the amino-terminal domain of NIFA and the C-terminal region of NIFL potentiate the ADP-dependent stimulation of NIFL-NIFA complex formation.