A minimal system of five purified proteins, hsp90, hsp70, Hop, hsp40, and p23, assembles glucocorticoid receptor (GR).hsp90 heterocomplexes and causes the simultaneous opening of the steroid binding cleft to access by steroid. The first step in assembly is the ATP-dependent and hsp40 (YDJ-1)-dependent binding of hsp70 to the GR, which primes the receptor for subsequent ATP-dependent activation by hsp90, Hop, and p23 (Morishima, Y., Murphy, P. J. M., Li, D. P., Sanchez, E. R., and Pratt, W. B. (2000) J. Biol. Chem. 275, 18054-18060). Here we have examined the nucleotide-bound states of the two essential chaperones in each step. We show that it is the ATP-bound state of hsp70 that interacts initially with the GR. After rapid priming and washing, the primed GR.hsp70 complex rapidly binds hsp90 in the second step reaction in a nucleotide-independent manner. The rate-limiting step is the ATP-dependent opening of the steroid binding cleft after hsp90 binding. This activating step requires the N-terminal ATP-binding site of hsp90, but we cannot establish any role for a C-terminal ATP-binding site in steroid binding cleft opening. The reported specific inhibitors of the C-terminal ATP site on hsp90 inhibit the generation of steroid binding, but they have other effects in this multiprotein system that could explain the inhibition.