A key step in fungal biosynthesis of lysine, enzymatic reduction of alpha-aminoadipate at C6 to the semialdehyde, requires two gene products in Saccharomyces cerevisiae, Lys2 and Lys5. Here, we show that the 31-kDa Lys5 is a specific posttranslational modification catalyst, using coenzyme A (CoASH) as a cosubstrate to phosphopantetheinylate Ser880 of the 155-kDa Lys2 and activate it for catalysis. Lys2 was subcloned from S. cerevisiae and expressed in and purified from Escherichia coli as a full-length 155-kDa enzyme, as a 105-kDa adenylation/peptidyl carrier protein (A/PCP) fragment (residues 1-924), and as a 14-kDa PCP fragment (residues 809-924). The apo-PCP fragment was covalently modified to phosphopantetheinylated holo-PCP by pure Lys5 and CoASH with a Km of 1 microM and kcat of 3 min-1 for both the PCP and CoASH substrates. The adenylation domain of the A/PCP fragment activated S-carboxymethyl-L-cysteine (kcat/Km = 840 mM-1 min-1) at 16% the efficiency of L-alpha-aminoadipate in [32P]PPi/ATP exchange assays. The holo form of the A/PCP 105-kDa fragment of Lys2 covalently aminoacylated itself with [35S]S-carboxymethyl-L-cysteine. Addition of NADPH discharged the covalent acyl-S-PCP Lys2, consistent with a reductive cleavage of the acyl-S-enzyme intermediate. These results identify the Lys5/Lys2 pair as a two-component system in which Lys5 covalently primes Lys2, allowing alpha-aminoadipate reductase activity by holo-Lys2 with catalytic cycles of autoaminoacylation and reductive cleavage. This is a novel mechanism for a fungal enzyme essential for amino acid metabolism.