Purine nucleoside phosphorylases (PNPs) catalyze the phosphorolysis of 6-oxypurine nucleosides with an HPO42- dianion nucleophile. Nucleosides and phosphate occupy distinct pockets in the PNP active site. Evaluation of the HPO42- site by mutagenesis, cooperative binding studies, and thermodynamic and structural analysis demonstrate that alterations in the HPO42- binding site can render PNP inactive and significantly impact subunit cooperativity and binding to transition-state analogue inhibitors. Cooperative interactions between the cationic transition-state analogue and the anionic HPO42- nucleophile demonstrate the importance of reforming the transition-state ensemble for optimal inhibition with transition-state analogues. Altered phosphate binding in the catalytic site mutants helps to explain one of the known lethal PNP deficiency syndromes in humans.