The recent determination of the crystal structure of adenylyl cyclase has elucidated many structural features that determine the regulatory properties of the enzyme. In addition, the characterization of adenylyl cyclase by mutagenic techniques and the identification of the binding site for P-site inhibitors have led to modeling studies that describe the ATP-binding site. Despite these advances, the catalytic mechanism of adenylyl cyclase remains uncertain, especially with respect to the role that magnesium ions may play in this process. We have identified four mutant mammalian adenylyl cyclases defective in their metal dependence, allowing us to further characterize the function of metal ions in the catalytic mechanism of this enzyme. The wild-type adenylyl cyclase shows a biphasic Mg2+ dose-response curve in which the high-affinity component displays cooperativity (Hill coefficient of 1.4). Two mutations (C441R and Y442H) reduce the affinity of the adenylyl cyclase for Mg2+ dramatically without affecting the binding of MgATP, suggesting that there is a metal requirement in addition to the ATP-bound Mg2+. The results of this study thus demonstrate multiple metal requirements of adenylyl cyclase and support the existence of a Mg2+ ion essential for catalysis and distinct from the ATP-bound ion. We propose that adenylyl cyclase employs a catalytic mechanism analogous to that of DNA polymerase, in which two key magnesium ions facilitate the nucleophilic attack of the 3'-hydroxyl group and the subsequent elimination of pyrophosphate.