We have previously reported that bacterial flavohemoglobin (HMP) catalyzes both a rapid reaction of heme-bound O(2) with nitric oxide (NO) to form nitrate [HMP-Fe(II)O(2) + NO --> HMP-Fe(III) + NO(3)(-)] and, under anaerobic conditions, a slower reduction of heme-bound NO to an NO(-) equivalent (followed by the formation of N(2)O), thereby protecting against nitrosative stress under both aerobic and anaerobic conditions, and rationalizing our finding that NO is rapidly consumed across a wide range of O(2) concentrations. It has been alternatively suggested that HMP activity is inhibited at low pO(2) because the enzyme is then in the relatively inactive nitrosyl form [k(off)/k(on) for NO (0.000008 microM) k(off)/k(on) for O(2) (0.012 microM) and K(M) for O(2) = 30-100 microM]. To resolve this discrepancy, we have directly measured heme-ligand turnover and NADH consumption under various O(2)/NO concentrations. We find that, at biologically relevant O(2) concentrations, HMP preferentially binds NO (not O(2)), which it then reacts with oxygen to form nitrate (in essence NO(-) + O(2) --> NO(3)(-)). During steady-state turnover, the enzyme can be found in the ferric (FeIII) state. The formation of a heme-bound nitroxyl equivalent and its subsequent oxidation is a novel enzymatic function, and one that dominates the oxygenase activity under biologically relevant conditions. These data unify the mechanism of HMP/NO interaction with those recently described for the nematode Ascaris and mammalian hemoglobins, and more generally suggest that the peroxidase (FeIII)-like properties of globins have evolved for handling of NO.