Fragments of the two cytoplasmic domains of mammalian adenylyl cyclases can be synthesized independently (and abundantly) as soluble proteins; Gsalpha- and forskolin-stimulated enzymatic activity is restored upon their mixture. We have utilized this system to characterize the interactions of adenylyl cyclase with forskolin and its substrate, ATP. In the presence of Gsalpha, adenylyl cyclase is activated in response to occupation of only one forskolin-binding site. A single binding site for forskolin was identified by equilibrium dialysis; its Kd (0.1 microM) corresponds to the EC50 for enzyme activation. The affinity of forskolin for adenylyl cyclase is greatly reduced in the absence of Gsalpha ( approximately 40 microM). Binding of forskolin to the individual cytoplasmic domains of the enzyme was not detected. A single binding site for the ATP analog, alpha,beta-methylene ATP (Ap(CH2)pp), was also detected by equilibrium dialysis. Such binding was not observed with the individual domains. Binding of Ap(CH2)pp was unaffected by P-site inhibitors of adenylyl cyclase. A modified P-loop sequence located near the carboxyl terminus of adenylyl cyclase has been implicated in ATP binding. Mutation of the conserved, non-glycine residues within this region caused no significant changes in the Km for ATP or the Ki for Ap(CH2)pp. It thus seems unlikely that this region is part of the active site. However, a mutation in the C1 domain (E518A) causes a 10-fold decrease in the binding affinity for Ap(CH2)pp. This residue and the active site of the enzyme may lie at the interface between the two cytosolic domains.