The principal locus for binding interactions between the aspartate and serine receptors of Escherichia coli and the methyltransferase was found to be in the last five amino acids of the receptor. The thermodynamic parameters of transferase-receptor interactions were determined by isothermal titration calorimetry. The serine receptor and three C-terminal fragments (C-fragments) of the aspartate receptor consisting of either the last 297, 88, or 38 amino acids gave comparable values for binding (n = 1, Delta H approximate to 13 kcal/mol, and K-a approximate to 4 x 10(5) M(-1)). Truncating either 16 or 36 amino acids from the C-terminus eliminated observable interactions. Finally the pentapeptide Asn-Trp-Glu-Thr-Phe, which corresponds to the last five amino acids of the receptor and is strictly conserved among the E. coli serine and aspartate receptors and the Salmonella typhimurium aspartate receptor, was found to have all the binding activity of the full-length receptor and the C-fragments. An in vitro methylation assay was used to obtain evidence for the physiological significance of this interaction in which excess peptide was able to completely block receptor methylation. The location of the binding site far from the methylation sites in the primary structure of the receptor suggests that the principle role of this interaction may be to hold the transferase in close proximity to all of the methylation sites. Intersubunit methylation is proposed as plausible consequence of this ''controlled proximity'' mechanism since the ribose-galactose and dipeptide receptors lack the transferase binding sequence, and appear unable to bind transferase. Intersubunit methylation implies that transferase bound to either the serine or aspartate receptor subunit may catalyze methylation of receptor subunits in a neighboring dimer, including those that have different ligand specificity.