It has been shown recently that Trp171 of lignin peroxidase (LiP) is hydroxylated at the Cbeta position [Blodig, W., Doyle, W. A., Smith, A. T., Winterhalter, K., Choinowski, T., and Piontek, K. (1998) Biochemistry 37, 8832-8838]. Comparative experiments, carried out on both wild-type fungal and recombinant LiP isoenzyme H8 (LiPH8), indicate that the process of hydroxylation is autocatalytic and that Trp171 may be implicated in catalysis. The role of this residue has therefore been examined using site-directed mutagenesis to obtain recombinant enzymes with Trp171 substituted by Phe or Ser (W171F and W171S LiPH8, respectively). The wild-type recombinant enzyme (LiPH8) was analyzed in solution using 1H NMR spectroscopy and its integrity confirmed prior to the kinetic and spectroscopic characterization of LiPH8 mutants. A charge neutralization mutation in the "classical heme edge" substrate access channel of LiP, in which Glu146 was substituted by Gly (E146G LiPH8), showed substantial activity with respect to veratryl alcohol (VA) oxidation and a marked (2.4 pH units) increase in pKa for the oxidation of a negatively charged difluoroazo dye. More surprisingly, the Trp171 LiPH8 mutants W171F and W171S LiPH8 were found to have lost all activity with VA as substrate, and compounds I and II were unable to react with VA. Both mutants, however, retained substantial activity with two dye substrates. These data provide the first direct evidence for the existence of two distinct substrate interaction sites in LiP, a heme-edge site typical of those encountered in other peroxidases and a second, novel site centered around Trp171 which is required for the oxidation of VA. Stopped-flow kinetic studies showed that all the mutants examined reacted normally with hydrogen peroxide to give a porphyrin cation radical (compound I). However, the rapid phase of spontaneous compound I reduction (2.3 s-1), typical of wild-type LiP, was absent in the Trp171 mutants, strongly suggesting that an electron-transfer pathway must exist within the protein leading from the heme to a surface site in close proximity to Trp171. The kinetic competence of such a pathway is dependent on interaction of the enzyme with VA, at or near Trp171.