Factor B is a serine protease, which despite its trypsin-like specificity has Asn instead of the typical Asp at the bottom of the S1 pocket (position 189, chymotrypsinogen numbering). Asp residues are present at positions 187 and 226 and either one could conceivably provide the negative charge for binding the P1-Arg of the substrate. Determination of the crystal structure of the factor B serine protease domain has revealed that the side chain of Asp226 is within the S1 pocket, whereas Asp187 is located outside the pocket. To investigate the possible role of these atypical structural features in substrate binding and catalysis, we constructed a panel of mutants of these residues. Replacement of Asp187 caused moderate (50-60%) decrease in hemolytic activity, compared with wild type factor B, whereas replacement of Asn189 resulted in more profound reductions (71-95%). Substitutions at these two positions did not significantly affect assembly of the alternative pathway C3 convertase. In contrast, elimination of the negative charge from Asp226 completely abrogated hemolytic activity and also affected formation of the C3 convertase. Kinetic analyses of the hydrolysis of a P1-Arg containing thioester by selected mutants confirmed that residue Asp226 is a primary structural determinant for P1-Arg binding and catalysis.