The chemical mechanism by which ATP synthases catalyze the synthesis of ATP remains unknown despite the recent elucidation of the three-dimensional structures of two forms of the F-1 catalytic sector (subunit stoichiometry, alpha(3)beta(3)gamma delta epsilon). Lacking is critical information about the chemical events taking place at the catalytic site of each P-subunit in the transition state. In an earlier report (Ko, Y. H., Planchet, M. A., Amzel, L. M., and Pedersen, P. L, (1997) J. Biol. Chem. 272, 18875-18881), we provided evidence for transition state formation in the presence of Mg2+, ADP, and orthovanadate (V-i), a photoreactive phosphate analog with a trigonal bipyramidal geometry resembling that of the gamma-P of ATP in the transition state of enzymes like myosin, In the presence of ultraviolet light and O-2, the MgADP.V-i-F-1 complex was cleaved within the P-loop (GG (A) under bar GVGKT) of a single P-subunit at alanine 158, implicating this residue as within contact distance of the gamma-P of ATP in the transition state. Here, we report that ADP, although facilitating transition state formation, is not essential. In the presence of Mg2+ and V-i alone the catalytic activity of the resultant MgVi-F-1 complex is inhibited to nearly the same extent as that observed for the MgADP.V-i-F-1 complex. Inhibition is not observed with ADP, Mg2+, or V-i alone. Significantly, in the presence of ultraviolet light and O-2, the MgVi-F-1 complex is cleaved also within the P-loop of a single beta-subunit at alanine 158 as confirmed by Western blot analyses with two different antibodies, by N-terminal sequence analyses, and by quantification of the amount of unreacted beta-subunits. These novel findings indicate that Mg2+ plays a pivotal role in transition state formation during ATP synthesis catalyzed by ATP synthases, a role that involves both its preferential coordination with P-i and the repositioning of the P-loop to bring the nonpolar alanine 158 into the catalytic pocket. A reaction scheme for ATP synthases depicting a role for Mg2+ in transition state formation is proposed here for the first time.