Iron-regulatory proteins (IRPs) 1 and 2 are cytosolic RNA-binding proteins that bind to specific stem-loop structures, termed iron-responsive elements (IREs) that are located in the untranslated regions of specific mRNAs encoding proteins involved in iron metabolism. The binding of IRPs to IREs regulates either translation or stabilization of mRNA. Although IRP1 and IRP2 are similar proteins in that they are ubiquitously expressed and are negatively regulated by iron, they are regulated by iron by different mechanisms. IRP1, the well-characterized IRP in cells, is a dual-function protein exhibiting either aconitase activity when cellular iron is abundant or RNA-binding activity when cellular iron is scarce. In contrast, IRP2 lacks detectable aconitase activity and functions exclusively as an RNA-binding protein. To study and compare the biochemical characteristics of IRP1 and IRP2, we expressed wild-type and mutant rat IRP1 and IRP2 in the yeast Saccharomyces cerevisiae. IRP1 and IRP2 expressed in yeast bind the IRE RNA with high affinity, resulting in the inhibition of translation of an IRE-reporter mRNA. Mutant IRP2s lacking a 73 amino acid domain unique to IRP2 and a mutant IRP1 containing an insertion of this domain bound RNA, but lacked detectable aconitase activity, suggesting that the presence of this domain prevents aconitase activity. Like IRP1, the RNA-binding activity of IRP2 was sensitive to inactivation by N-ethylmaleimide (NEM) or 5,5'-dithiobis(2-nitrobenzoic acid) (DTNB), indicating IRP2 contains a cysteine(s) that is (are) necessary for RNA binding. However, unlike IRP1, where reconstitution of the 4Fe-4S cluster resulted in a loss in RNA-binding activity, the RNA-binding activity of IRP2 was unaffected using the same iron treatment. These data suggested that IRP2 does not contain a 4Fe-4S cluster similar to the cluster in IRP1, indicating that they sense iron by different mechanisms.