Among many proteins with cysteine sulfinic acid (Cys-SO2H) residues, the sulfinic forms of certain peroxiredoxins (Prxs) are selectively reduced by sulfiredoxin (Srx) in the presence of ATP. All Srx enzymes contain a conserved cysteine residue. To elucidate the mechanism of the Srx-catalyzed reaction, we generated various mutants of Srx and examined their interaction with PrxI, their ATPase activity, and their ability to reduce sulfinic PrxI. Our results suggest that three surface-exposed amino acid residues, corresponding to Arg50, Asp57, and Asp79 of rat Srx, are critical for substrate recognition. The presence of the sulfinic form (but not the reduced form) of PrxI induces the conserved cysteine of Srx to take the gamma-phosphate of ATP and then immediately transfers the phosphate to the sulfinic moiety of PrxI to generate a sulfinic acid phosphoryl ester (Prx-Cys-S(=O)OPO3(2-)). This ester is reductively cleaved by a thiol molecule (RSH) such as GSH, thioredoxin, and dithiothreitol to produce a disulfide-S-monoxide (Prx-Cys-S(=O)-S-R). The disulfide-S-monoxide is further reduced through the oxidation of three thiol equivalents to complete the catalytic cycle and regenerate Prx-Cys-SH.