Environmental and clinical isolates of mercury-resistant (resistant to inorganic mercury salts and organomercurials) bacteria have genes for the enzymes mercuric ion reductase and organomercurial lyase. These genes are often plasmid-encoded, although chromosomally encoded resistance determinants have been occasionally identified. Organomercurial lyase cleaves the C-Hg bond and releases Hg(II) in addition to the appropriate organic compound. Mercuric reductase reduces Hg(II) to Hg(O), which is nontoxic and volatilizes from the medium. Mercuric reductase is a FAD-containing oxidoreductase and requires NAD(P)H and thiol for in vitro activity. The crystal structure of mercuric ion reductase has been partially solved. The primary sequence and the three-dimensional structure of the mercuric reductase are significantly homologous to those of other flavin-containing oxidoreductases, e.g., glutathione reductase and lipoamide dehydrogenase. The active site sequences are the most conserved region among these flavin-containing enzymes. Genes encoding other functions have been identified on all mercury ion resistance determinants studied thus far. All mercury resistance genes are clustered into an operon. Hg(II) is transported into the cell by the products of one to three genes encoded on the resistance determinants. The expression of the operon is regulated and is inducible by Hg(II). In some systems, the operon is inducible by both Hg(II) and some organomercurials. In gram-negative bacteria, two regulatory genes (merR and merD) were identified. The (merR) regulatory gene is transcribed divergently from the other genes in gram-negative bacteria. The product of merR represses operon expression in the absence of the inducers and activates transcription in the presence of the inducers. The product of merD coregulates (modulates) the expression of the operon. Both merR and merD gene products bind to the same operator DNA. The primary sequence of the promoter for the polycistronic mer operon is not ideal for efficient transcription by the RNA polymerase. The -10 and -35 sequences are separated by 19 (gram-negative systems) or 20 (gram-positive systems) nucleotides, 2 or 3 nucleotides longer than the 17-nucleotide optimum distance for binding and efficient transcription by the Escherichia coli sigma 70-containing RNA polymerase. The binding site of MerR is not altered by the presence of Hg(II) (inducer). Experimental data suggest that the MerR-Hg(II) complex alters the local structure of the promoter region, facilitating initiation of transcription of the mer operon by the RNA polymerase. In gram-positive bacteria MerR also positively regulates expression of the mer operon in the presence of Hg(II).