TonB-dependent iron transporters reside in the outer membranes of Gram-negative bacteria, transporting ferric-complexes into the periplasm by a mechanism requiring proton motive force and an integral inner membrane complex, TonB-ExbB-ExbD. Certain TonB-dependent transporters contain an additional domain at the N-terminus, which interacts with an inner membrane regulatory protein and a cytoplasmic sigma factor to induce transcription of iron transport genes when a ferric-ligand is bound at the extracellular surface of the transporter. Transport of the ferric-ligand is apparently not necessary for transcription induction. Recent biophysical and crystallographic experiments have shown that this subclass of TonB-dependent iron transporters can bind iron-free ligands, whereas only the ferric-ligands are transported into the periplasm. This review focuses on the ligand binding properties of these transporters and includes a discussion of the biological function of the additional domain, the mechanism of transcription induction and the mechanism of ferric-ligand transport.