The regulation of the tryptophan-nicotinic acid pathway in Neurospora crassa was examined with mutants (nic-2, nic-3) which require nicotinamide for growth. The accumulation of N-acetylkynurenin and 3-hydroxyanthranilic acid by these mutants served to estimate the level of function of the early reactions in the pathway. In still cultures, maximal accumulation occurred with media containing growth-limiting amounts of nicotinamide; the accumulation of intermediates was almost negligible with nicotinamide in excess. Only nicotinamide and closely related compounds which also supported the growth of these mutants inhibited the accumulation of intermediates. The site of inhibition was assessed to be between tryptophan and kynurenin (or N-acetylkynurenin). The synthesis of N-acetylkynurenin was examined in washed germinated conidia suspended in buffer; the level of N-acetylkynurenin-synthesizing activity was inversely related to the concentration of nicotinamide in the germination medium. The addition of large amounts of nicotinamide to suspensions of germinated conidia did not affect their N-acetylkynurenin-synthesizing activity. Formamidase activity, kynurenin-acetylating activity, and gross tryptophan metabolism in germinated conidia was not influenced by the concentration of nicotinamide in the germination medium. The results obtained indicate that the site of inhibition by nicotinamide is the first step in the pathway, the tryptophan pyrrolase reaction. The data are interpreted as nicotinamide or a product thereof, such as nicotinamide adenine dinucleotide, acting as a repressor of the formation of tryptophan pyrrolase in N. crassa.