The diphtheria tox repressor (DtxR) is a transition metal ion-dependent regulatory element that controls the expression of diphtheria toxin and several genes involved in the synthesis of siderophores in Corynebacterium diphtheriae. In the presence of transition metal ions apo-DtxR becomes activated and specifically binds to its target DNA sequences. We demonstrate by glutaraldehyde cross-linking that monomeric apo-DtxR is in weak equilibrium with a dimeric form and that upon addition of activating metal ions to the reaction mixture a dimeric complex is stabilized. Addition of the DNA-binding-defective mutant apo-DtxR(delta 1-47) to apo-DtxR in the absence of transition metal ions inhibits conversion of the apo-repressor to its activated DNA-binding form. We also show that the binding of Ni2+ to both apo-DtxR and apo-DtxR(delta 1-47) is cooperative and that upon ion binding there is a conformational change in the environment of the indole ring moiety of Trp-104. For the wild-type repressor the consequences of this conformational change include a shift in equilibrium toward dimer formation and activation of target DNA binding by the repressor. We conclude that the formation of DtxR homodimers is mediated through a protein-protein interaction domain that is also activated on metal ion binding.