Mouse lung carbonyl reductase, a member of the short-chain dehydrogenase/reductase (SDR) family, shows a strong coenzyme preference for NADP(H) over NAD(H), and is uniquely activated by fatty acids. Previous chemical modification and X-ray crystallography studies show that interactions responsible for the coenzyme specificity include salt linkages between the 2'-phosphate of NADPH and side-chains of Lys-17 and Arg-39 of the enzyme. Although Arg-39 is highly conserved in NADP(H)-dependent enzymes of the SDR family, Lys-17 is substituted with Arg in about half of the NADP(H)-dependent enzymes. The present study shows that mutations of Lys-17 to His (K17H) or Ser (K17S) and of Arg-39 to Ala (R39A) bring about decreases (from 5 to 90-fold) of the affinities for NADP(H), but minor changes in the affinity for NAD+. The binding energy arising from the mutations on the binding of the 2'-phosphate of NADP+ was decreased by 38-66% from the value of 4.8 kcal/mol calculated for the wild-type enzyme. In contrast, the mutation of Lys-17 to Arg (K17R) had little effect on the kinetic or thermodynamic properties. The activation by fatty acids was completely attenuated by the mutations of K17H and K17S, but not by K17R or R39A. These results indicate that the 2'-phosphate group of NADP(H) is recognized by both Lys-17 and Arg-39, of which Lys-17 is a component of the binding site for the activator, probably interacting with the negatively charged carboxylate group of fatty acids, and also suggest that the existence of a positively charged residue (either Lys or Arg) at position 17 is required for both NADP(H) specificity of the SDR family enzymes and fatty acid activation of the pulmonary carbonyl reductase.