Abstract The acetyl-CoA:acetoacetate CoA-transferase of Escherichia coli was reversibly inactivated by pyridoxal 5′-phosphate. The residual activity of the enzyme was dependent on the concentration of the modifying reagent to a concentration of 5 m m. The maximum level of inactivation was 89%. Kinetic and equilibrium analyses of inactivation were consistent with a two-step process (Chen and Engel, 1975, Biochem. J. 149, 619) in which the extent of inactivation was limited by the ratio of first-order rate constants for the reversible formation of an inactive Schiff base of pyridoxal 5′-phosphate and the enzyme from a noncovalent, dissociable complex of the enzyme and modifier. The calculated minimum residual activity was in close agreement with the experimentally determined value. The conclusion that the loss of catalytic activity resulted from modification of a lysine residue at the active site was based on the following data, (a) After incubation with 5 m m pyridoxal 5′-phosphate, 3.95 mol of the reagent was incorporated per mole of free enzyme with 89% loss of activity, while 2.75 mol of pyridoxal 5′-phosphate was incorporated into the enzyme-CoA intermediate with a loss of 10% of catalytic activity; the intermediate was formed in the presence of acetoacetyl-CoA; (b) acid hydrolysis of the modified, reduced enzyme-CoA intermediate yielded a single fluorescent compound that was identified as N 6-pyridoxyllysine by chromatography in two solvent systems; (c) the enzyme was also protected from inactivation by saturating concentrations of free CoA and ADP but not by adenosine. The results suggested that a lysine residue is involved in the electrostatic binding of the pyrophosphate group of CoA. Carboxylic acid substrate did not protect the enzyme from inactivation.