During heme deficiency in reticulocyte lysates, a translational inhibitor (heme-regulated inhibitor, HRI) that blocks polypeptide chain initiation is activated. HRI is a protein kinase that specifically phosphorylates the 38,000-dalton subunit of the Met-tRNAfMet binding factor, eIF-2. Phosphorylation of eIF-2 by HRI prevents its interaction with at least two additional factors, resulting in a net reduction in formation of ternary complex (Met-tRNAfMet.eIF-2.GTP) and AUG-dependent transfer of Met-tRNAfMet to 40S ribosomal subunits. A factor (sRF) that reverses protein synthesis inhibition in heme-deficient lysates has been purified from reticulocyte postribosomal supernatant. sRF also reverses the inhibition of ternary complex formation by HRI in a fractionated system. The ternary complex inhibition reversal activity and the protein synthesis inhibition reversal activity cosediment at 12.5 S upon glycerol density gradient centrifugation, and both activities are sensitive to heat or N-ethylmaleimide. Purified sRF does not dephosphorylate eIF-2 whose phosphorylation has been catalyzed by HRI, nor does the sRF prevent the phosphorylation of eIF-2 by HRI in a fractionated system. sRF stimulates ternary complex formation by both phosphorylated and nonphosphorylated eIF-2. These observations suggest that the sensitivity of protein synthesis to phosphorylation of eIF-2 by HRI may be modulated by the concentration and activity of sRF.