The ab initio fragment molecular orbital (FMO) calculations were performed for the cAMP receptor protein (CRP) complexed with a cAMP and DNA duplex to elucidate their sequence-specific binding and the stability of the DNA duplex, as determined by analysis of their inter- and intramolecular interactions. Calculations were performed with the AMBER94 force field and at the HF and MP2 levels with several basis sets. The interfragment interaction energies (IFIEs) were analyzed for interactions of CRP-cAMP with each base pair, DNA duplex with each amino acid residue, and each base pair with each residue. In addition, base-base interactions were analyzed including hydrogen bonding and stacking of DNA. In the interaction between DNA and CRP-cAMP, there was a significant charge transfer (CT) from the DNA to CRP, and this CT interaction played an important role as well as the electrostatic interactions. It is necessary to apply a quantum mechanical approach beyond the "classical" force-field approach to describe the sequence specificity. In the DNA intramolecular interaction, the dispersion interactions dominated the stabilization of the base-pair stacking interactions. Strong, attractive 1,2-stacking interactions and weak, repulsive 1,3-stacking interactions were observed. Comparison of the intramolecular interactions of free and complexed DNA revealed that the base-pairing interactions were stronger, and the stacking interactions were weaker, in the complexed structure. Therefore, the DNA duplex stability appears to change due to both the electrostatic and the CT interactions that take place under conditions of DNA-CRP binding.