The role of Cys residues in the site-specific DNA binding activity of the nuclear factor I (NFI) family of proteins was assessed by chemical modification and site-specific mutagenesis. Treatment with the thio-specific reagent N-ethylmaleimide abolished site-specific DNA binding of all forms of NFI present in HeLa nuclear extracts. Preincubation of cell extracts with an oligonucleotide containing an NFI-binding site provided partial protection of NFI from N-ethylmaleimide inactivation. Mutations were made in the cDNA encoding a truncated form of the NFI-C/CAAT box transcription factor-1 protein, converting each of the five Cys residues in the DNA-binding domain of the protein into Ser residues. NFI-C proteins containing mutations in any of four conserved Cys residues, expressed in Escherichia coli or in vitro, did not bind to DNA. NFI-C with a mutation in a nonconserved Cys residue had normal DNA binding activity. Both this active mutant and wild-type NFI-C protein were inactivated by modification of their sulfhydryl residues with 5,5'-dithiobis(2-nitrobenzoic acid) (DTNB), and preincubation with an oligonucleotide containing an NFI-binding site gave partial protection against inactivation. After modification with DTNB, DNA binding activity was partially restored by subsequent incubation with dithiothreitol, indicating that inactivation of NFI by DTNB was reversible. These studies indicate an essential role for free sulfhydryl residues in NFI-DNA binding.