Human serum albumin (HSA) has been chemically modified with 1,2-cyclohexanedione and N-acetylimidazole under nondenaturing conditions. Derivatives, in which 10 arginine residues (1,2-dihydroxycyclohex-1,2-ylene (DHCH)-HSA), 56 to 57 lysine and 5 tyrosine residues (acetyl-HSA), or 56 to 57 lysine residues alone (O-deacetyl-HSA) are modified, have been isolated. Their conformation has been tested by circular dichroism measurement, gel filtration on Sephadex G-150, and ultracentrifugation. From these analyses and binding studies it is concluded that only insignificant changes of conformation have occurred. The binding properties of the HSA derivatives have been tested with bilirubin, diazepam (a benzodiazepine drug), phenylbutazone, and indomethacin by circular dichroism. The binding of diazepam to DHCH-HSA is almost completely inhibited and that of phenylbutazone and indomethacin decreased, while the binding of bilirubin is essentially unaffected. In acetyl-HSA and O-deacetyl-HSA, the bilirubin binding is significantly decreased, while the binding of the drugs mentioned is less affected. It is concluded that bilirubin and the drugs bind to two separate sites which contain positive charges essential for the binding properties. The charge(s) in the benzodiazepine site from arginine.