We have isolated a Dictyostelium mutant unable to induce expression of the prestalk-specific marker ecmB in monolayer assays. The disrupted gene, padA, leads to a range of phenotypic defects in growth and development. We show that padA is essential for growth, and we have generated a thermosensitive mutant allele, padA(-). At the permissive temperature, mutant cells grow poorly; they remain longer at the slug stage during development and are defective in terminal differentiation. At the restrictive temperature, growth is completely blocked, while development is permanently arrested prior to culmination. padA(-) slugs are deficient in prestalk A cell differentiation and present an abnormal ecmB expression pattern. Sequence comparisons and predicted three-dimensional structure analyses show that PadA carries an NmrA-like domain. NmrA is a negative transcriptional regulator involved in nitrogen metabolite repression in Aspergillus nidulans. PadA predicted structure shows a NAD(P)(+)-binding domain, which we demonstrate that is essential for function. We show that padA(-) development is more sensitive to ammonia than wild-type cells and two ammonium transporters, amtA and amtC, appear derepressed during padA(-) development. Our data suggest that PadA belongs to a new family of NAD(P)(+)-binding proteins that link metabolic changes to gene expression and is required for growth and normal development.