An in situ study was conducted of the cytochrome bd ubiquinol:oxygen oxidoreductase (cytochrome b558-b595-d) of Escherichia coli grown anaerobically on glycerol with fumarate as respiratory oxidant. Nitrite reacts with and is reduced by the oxidase, resulting in the formation of NO adducts to haems b595 and d. The kinetics of formation of these species indicate that the affinity of haem d for nitrite is higher than that of haem b595. CO also binds to the oxidase, resulting in the formation of CO adducts to haems d and b595. Binding titrations indicate that the affinity of haem d for CO is higher than that of haem b595. The steady state kinetics of the oxidase reaction in the presence of nitrite or CO are cooperative with respect to oxygen binding, suggesting that both haems d and b595 are involved in the reduction of oxygen. E.p.r. studies of the ferric oxidase indicate the presence of two high spin haem signals, one rhombic and one axial, which are assigned to haems b595 and d, respectively. These signals titrate potentiometrically with midpoint potentials similar to those published on the basis of optically followed titrations for haems b595 and d. The high spin ferric haem spectra are affected by oxygen, CO, cyanide, and pH. A low spin ferric haem signal is observed at g=3.3 and is assigned to haem b558. The sidedness with respect to the cytoplasmic membrane of ligand binding haems of the oxidase was determined by investigating the effect of the exogenous paramagnetic probe DyEDTA on the e.p.r. properties of the ferrous haems d-NO and b595-NO. These haems are located towards the inner aspect of the cytoplasmic membrane at around 8 and 12A° below the surface, respectively. Overall, the data supports a functional model for cytochrome bd with two oxygen binding sites, haems d and b595, forming the binuclear centre of the oxidase reaction. Possible mechanisms of this reaction are discussed.