Understanding the mechanism in the folding pathways of proteins is an important problem in molecular biology. The Phi-value analysis provides insight into the transition state structures during protein folding. In this work, we have analyzed the relationship between the observed Phi values upon mutations in two-state proteins (FK506 binding protein, chymotrypsin inhibitor and src SH3 domain) and the changes in 48 various physico-chemical, energetic and conformational properties. We found that the classification of mutations based on solvent accessibility improved the correlation significantly. The relationship between conformational properties and Phi values determines the presence/absence of secondary structures in the transition state. In buried mutations, the physical properties volume, shape and flexibility, and the thermodynamic properties enthalpy, entropy and free-energy change have significant correlation with Phi. The short and medium-range non-bonded energy in partially buried mutations and average long-range contacts in exposed mutations showed a strong correlation with Phi values. Multiple regression analysis incorporating combinations of three properties from among all possible combinations of the 48 properties increased the correlation coefficient up to 0.99, by an average rise of 20% for all the data sets. Information about local sequence and structure is more important in surface mutations than those in buried mutations for explaining the transition state structures of two-state proteins. Further, the implications of our results for understanding the process of protein folding have been discussed. (C) 2002 Published by Elsevier Science B.V. on behalf of the Federation of European Biochemical Societies.