Nucleotide excision repair (NER) removes chemically diverse DNA lesions in all domains of life. In Escherichia coli, UvrA and UvrB initiate NER, although the mechanistic details of how this occurs in vivo remain to be established. Here, we use single-molecule fluorescence imaging to provide a comprehensive characterization of the lesion search, recognition and verification process in living cells. We show that NER initiation involves a two-step mechanism in which UvrA scans the genome and locates DNA damage independently of UvrB. Then UvrA recruits UvrB from solution to the lesion. These steps are coordinated by ATP binding and hydrolysis in the 'proximal' and 'distal' UvrA ATP-binding sites. We show that initial UvrB-independent damage recognition by UvrA requires ATPase activity in the distal site only. Subsequent UvrB recruitment requires ATP hydrolysis in the proximal site. Finally, UvrA dissociates from the lesion complex, allowing UvrB to orchestrate the downstream NER reactions.