N-2 fixation and oxygenic photosynthesis are important metabolic processes that are at odds with each other, since the N-2-fixing enzyme, nitrogenase, is highly sensitive to oxygen. This review will discuss the strategies devised by the unicellular, diazotrophic cyanobacterium, Cyanothece sp. ATCC 51142, to permit N-2 fixation and photosynthesis to coexist in the same cell. This strain, like a number of other unicellular and filamentous (nonheterocystous) cyanobacteria, has developed a type of temporal regulation in which N-2 fixation and photosynthesis occur at different times throughout a diurnal cycle. For nitrogenase, everyday dawns anew. The nifHDK operon is tightly regulated, such that transcription and translation occur within the first four hours of the dark period; nitrogenase is then proteolytically degraded. Photosynthesis also varies throughout the day reaching a minimum at the peak of nitrogenase activity and a maximum by late afternoon. This review will mainly concentrate on the various changes that occur in the photosynthetic apparatus as the cell modulates O-2 evolution. The results indicate that the redox poise of the plastoquinone pool and the overall cellular energy needs are the basic driving forces behind these changes in the photosynthetic apparatus. Throughout the course of the diurnal cycle, Photosystem II becomes very heterogeneous as determined by 77 K fluorescence spectra, PAM fluorescence and O-2-flash yield experiments. This system provides some important insight into cyanobacterial state transitions and, especially, on the organization of the photosystems within the membrane. Overall, PS II is altered on both the oxidizing and reducing sides of the photosystem.