F420H2:NADP+ Oxidoreductase (Fno) catalyzes the reversible reduction of NADP+ to NADPH by transferring a hydride from the reduced F420 cofactor. Here, we have employed binding studies, steady-state and pre steady-state kinetic methods upon wtFno and isoleucine 135 (I135) Fno variants in order to study the effects of side chain length on the donor-acceptor distance between NADP+ and the F420 precursor, FO. The conserved I135 residue of Fno was converted to a valine, alanine and glycine, thereby shortening the side chain length. The steady-state kinetic analysis of wtFno and the variants showed classic Michaelis-Menten kinetics with varying FO concentrations. The data revealed a decreased kcat as side chain length decreased, with varying FO concentrations. The steady-state plots revealed non-Michaelis-Menten kinetic behavior when NADPH was varied. The double reciprocal plot of the varying NADPH concentrations displays a downward concave shape, while the NADPH binding curves gave Hill coefficients of less than 1. These data suggest that negative cooperativity occurs between the two identical monomers. The pre steady-state Abs420 versus time trace revealed biphasic kinetics, with a fast phase (hydride transfer) and a slow phase. The fast phase displayed an increased rate constant as side chain length decreased. The rate constant for the second phase, remained ~2 s−1 for each variant. Our data suggest that I135 plays a key role in sustaining the donor-acceptor distance between the two cofactors, thereby regulating the rate at which the hydride is transferred from FOH2 to NADP+. Therefore, Fno is a dynamic enzyme that regulates NADPH production.