The static and dynamical behavior of a fluorescently labeled mutant of the Escherichia coli periplasmic phosphate binding protein (PBP) was investigated through steady-state and time-resolved fluorescence spectroscopy. As a means of developing a biorecognition element for inorganic phosphate (P(i)), alanine-197 of PBP was replaced with a cysteine. This site was then labeled with an environmentally sensitive fluorophore. The fluorescence emission of the mutant PBP labeled with acrylodan (MPBP-AC) proved to be sensitive to micromolar concentrations of P(i), as indicated by a 50% increase in the steady-state emission intensity. Steady-state results indicated that the labeling protocol was specific for cys-197 only and did not label the wild-type PBP; thus, a site-selective labeling protocol was developed. Time-resolved measurements were used to determine the influence of the dynamics of MPBP-AC on the process of signal transduction. Time-resolved anisotropy measurements revealed that rotational dynamics were best described by a model with two independent motions: the global motion of the protein and the local motion of the acrylodan probe. The rates of both global and local rotational reorientation of MPBP-AC were faster when the protein was P(i)-bound rather than P(i)-free. This was a result of structural changes involving or surrounding both the P(i)-binding site (global changes) and the residues in near proximity to the fluorescent reporter group (local changes). Recovery of the semiangle (theta) indicated that local structural changes in MPBP-AC took place when P(i) was bound to the protein. Acrylodan gained mobility when MPBP-AC bound P(i), as indicated by the fact that theta increased by approximately 5 degrees. In addition, dynamic quenching measurements confirmed that structural changes occurred locally near the cys-197. Acrylodan became more accessible to iodide when MPBP-AC bound P(i), as demonstrated by the 35% increase in the value of the bimolecular quenching constant.