The replacement of the active site nucleophile Glu 358 in Agrobacterium beta-glucosidase by Asn and Gln by site-directed mutagenesis results in essentially complete inactivation of the enzyme, while replacement by Asp generates a mutant with a rate constant for the first step, formation of the glycosylenzyme, some 2500 times lower than that of the native enzyme. This low activity is shown to be a true property of the mutant and not due to contaminating wild-type enzyme by active site titration studies and also through studies of its thermal denaturation and of the pH dependence of the reaction catalyzed. Binding of ground-state inhibitors is affected relatively little by the mutation, while binding of transition-state analogues is greatly impaired, consistent with a principal role for Glu 358 being in transition-state stabilization, not substrate binding. Determination of kinetic parameters for a series of aryl glucosides revealed that the glycosylation step is rate determining for all these substrates in contrast to the native enzyme, where a switch from rate-limiting glycosylation to rate-limiting deglycosylation was observed as substrate reactivity was increased. These results coupled with secondary deuterium kinetic isotope effects of kH/kD = 1.17 and 1.12 measured for the 2,4-dinitrophenyl and p-nitrophenyl glucosides point to a principal role of the nucleophile in stabilizing the cationic transition states and in formation of the covalent intermediate.(ABSTRACT TRUNCATED AT 250 WORDS)