Previously characterized nitrite reductases fall into three classes: siroheme-containing enzymes (NirBD), cytochrome c hemoproteins (NrfA and NirS), and copper-containing enzymes (NirK). We show here that the di-iron protein YtfE represents a physiologically relevant new class of nitrite reductases. Several functions have been previously proposed for YtfE, including donating iron for the repair of iron-sulfur clusters that have been damaged by nitrosative stress, releasing nitric oxide (NO) from nitrosylated iron, and reducing NO to nitrous oxide (N2O). Here, in vivo reporter assays confirmed that Escherichia coli YtfE increased cytoplasmic NO production from nitrite. Spectroscopic and mass spectrometric investigations revealed that the di-iron site of YtfE exists in a mixture of forms, including nitrosylated and nitrite-bound, when isolated from nitrite-supplemented, but not nitrate-supplemented, cultures. Addition of nitrite to di-ferrous YtfE resulted in nitrosylated YtfE and the release of NO. Kinetics of nitrite reduction were dependent on the nature of the reductant; the lowest Km, measured for the di-ferrous form, was ∼90 μM, well within the intracellular nitrite concentration range. The vicinal di-cysteine motif, located in the N-terminal domain of YtfE, was shown to function in the delivery of electrons to the di-iron center. Notably, YtfE exhibited very low NO reductase activity and was only able to act as an iron donor for reconstitution of apo-ferredoxin under conditions that damaged its di-iron center. Thus, YtfE is a high-affinity, low-capacity nitrite reductase that we propose functions to relieve nitrosative stress by acting in combination with the co-regulated NO-consuming enzymes Hmp and Hcp.