Bacteriophage lambda integrase (lambda-Int), a phage-encoded DNA recombinase, cleaves its substrate DNA to facilitate the formation and later resolution of a Holliday junction intermediate during recombination. The core-binding and catalytic domains of lambda-Int constitute a bipartite enzyme that mediates site-specific DNA cleavage through their interactions with opposite sides of the recognition sequence. Despite minimal direct contact between the domains, the core-binding domain has been shown to facilitate site-specific DNA cleavage when provided in trans, indicating that it plays a role beyond enhancing binding affinity. Biophysical characterization of the core-binding domain and its interactions with DNA reveal that the domain is poorly structured in its free form and folds upon binding to DNA. Folding of the protein is accompanied by induced-fit structural changes in the DNA ligand. These data support a model by which the core-binding domain plays a catalytic role by reshaping the substrate DNA for effective cleavage by the catalytic domain.