In general, oxidative stress, the consequence of an aerobic lifestyle, induces bacterial antioxidant defence enzymes. Here we report on a peroxiredoxin of Rhizobium etli, prxS, strongly expressed under microaerobic conditions and during the symbiotic interaction with Phaseolus vulgaris. The microaerobic induction of the prxS-rpoN2 operon is mediated by the alternative sigma factor RpoN and the enhancer-binding protein NifA. The RpoN-dependent promoter is also active under low-nitrogen conditions through the enhancer-binding protein NtrC. An additional symbiosis-specific weak promoter is located between prxS and rpoN2. Constitutive expression of prxS confers enhanced survival and growth to R. etli in the presence of H2O2. Single prxS mutants are not affected in their symbiotic abilities or defence response against oxidative stress under free-living conditions. In contrast, a prxS katG double mutant has a significantly reduced (>40%) nitrogen fixation capacity, suggesting a functional redundancy between PrxS and KatG, a bifunctional catalase-peroxidase. In vitro assays demonstrate the reduction of PrxS protein by DTT and thioredoxin. PrxS displays substrate specificity towards H2O2 (Km = 62 microM) over alkyl hydroperoxides (Km > 1 mM). Peroxidase activity is abolished in both the peroxidatic (C56) and resolving (C156) cysteine PrxS mutants, while the conserved C81 residue is required for proper folding of the protein. Resolving of the R. etli PrxS peroxidatic cysteine is probably an intramolecular process and intra- and intersubunit associations were observed. Taken together, our data support, for the first time, a role for an atypical 2-Cys peroxiredoxin against oxidative stress in R. etli bacteroids.