Core binding factors (CBFs) are heterodimeric transcription factors consisting of a DNA-binding CBFalpha subunit and non-DNA-binding CBFbeta subunit. The CBFbeta subunit increases the affinity of the DNA-binding Runt domain of CBFalpha for DNA while making no direct contacts to the DNA. We present evidence for conformational exchange in the S-switch region in a Runt domain-DNA complex that is quenched upon CBFbeta binding. Analysis of (15)N backbone relaxation parameters shows that binding of CBFbeta reduces the backbone dynamics in the microsecond-to-millisecond time frame for several regions of the Runt domain that make energetically important contacts with the DNA. The DNA also undergoes conformational exchange in the Runt domain-DNA complex that is quenched in the presence of CBFbeta. Our results indicate that allosteric regulation by the CBFbeta subunit is mediated by a shift in an existing dynamic conformational equilibrium of both the Runt domain and DNA.