Cytochrome P450s constitute a superfamily of enzymes that catalyze the oxid
ation of a vast number of structurally and chemically diverse hydrophobic s
ubstrates. Herein, we describe the crystal structure of a complex between t
he bacterial P450BM-3 and the novel substrate N-palmitoylglycine at a resol
ution of 1.65 Angstrom, which reveals previously unrecognizable features of
active site reorganization upon substrate binding. N-Palmitoylglycine bind
s with higher affinity than any other known substrate and reacts with a hig
her turnover number than palmitic acid but with unaltered regiospecificity
along the fatty acid moiety. Substrate binding induces conformational chang
es in distinct regions of the enzyme including part of the I-helix adjacent
to the active site. These changes cause the displacement by about 1 Angstr
om of the pivotal water molecule that ligands the heme iron, resulting in t
he low-spin to high-spin conversion of the iron. The water molecule is trap
ped close to the heme group, which allows it to partition between the iron
and the new binding site. This partitioning explains the existence of a hig
h-spin-low-spin equilibrium after substrate binding. The close proximity of
the water molecule to the heme iron indicates that it may also participate
in the proton-transfer cascade that leads to heterolytic bond scission of
oxygen in P450BM-3.