The role of specific cleavage of transcription repressor proteins by proteases and how this may be related to the emerging theme of dinucleotides as cellular signaling molecules is poorly characterized. The transcription repressor NmrA of Aspergillus nidulans discriminates between oxidized and reduced dinucleotides, however, dinucleotide binding has no effect on its interaction with the zinc finger in the transcription activator AreA. Protease activity in A. nidulans was assayed using NmrA as the substrate, and was absent in mycelium grown under nitrogen sufficient conditions but abundant in mycelium starved of nitrogen. One of the proteases was purified and identified as the protein Q5BAR4 encoded by the gene AN2366.2. Fluorescence confocal microscopy showed that the nuclear levels of NmrA were reduced approximately 38% when mycelium was grown on nitrate compared to ammonium and absent when starved of nitrogen. Proteolysis of NmrA occurred in an ordered manner by preferential digestion within a C-terminal surface exposed loop and subsequent digestion at other sites. NmrA digested at the C-terminal site was unable to bind to the AreA zinc finger. These data reveal a potential new layer of control of nitrogen metabolite repression by the ordered proteolytic cleavage of NmrA. NmrA digested at the C-terminal site retained the ability to bind NAD 1 and showed a resistance to further digestion that was enhanced by the presence of NAD 1 . This is the first time that an effect of dinucleotide binding to NmrA has been demonstrated.