The toxT gene encodes an AraC family transcriptional activator that is responsible for regulating virulence gene expression in Vibrio cholerae. Analysis of ToxT by dominant/negative assays and a LexA-based reporter system demonstrated that the N-terminus of the protein contains dimerization determinants, indicating that ToxT likely functions as a dimer. Additionally, a natural variant of ToxT with only 60% identity in the N-terminus, as well as a mutant form of ToxT with an altered amino acid in the N-terminus (L107F), exhibited altered transcriptional responses to bile, suggesting that the N-terminus is involved in environmental sensing. The C-terminus of ToxT functions to bind DNA and requires dimerization for stable binding in vitro, as demonstrated by gel shift analysis. Interestingly, a dimerized form of the ToxT C-terminus is able to bind DNA in vitro but is transcriptionally inactive in vivo, indicating that the N-terminus contains determinants that are required for transcriptional activation. These results provide a model for a two-domain structure for ToxT, with an N-terminal dimerization and environmental sensing domain and a C-terminal DNA-binding domain; unlike other well-studied AraC family proteins, both domains of ToxT appear to be required for transcriptional activation.