The dadAX operon is expressed by multiple promoters that are repressed by leucine-responsive regulatory protein (Lrp) and activated by cyclic AMP-CRP. In previous work, we found that alanine or leucine acted as inducers to antagonize Lrp repression of the three major promoters directly. Here, we identify 11 Lrp binding sites located within 350 bp of dad DNA. A mutational analysis, coupled with in vivo and in vitro transcription experiments, indicated that Lrp sites that overlap the dad promoters were involved in repression. In contrast, sites upstream of the promoters did not appear to be necessary for repression, but were required for activation by Lrp plus alanine or leucine of one of the major dad promoters, P2. This activation by alanine or leucine was not simply relief of repression, as P2 transcription from a constitutive template was increased fivefold compared with the basal level of transcription found in the absence of Lrp and the co-activator cyclic AMP-CRP. Alanine or leucine decreased the affinity of Lrp to repressor sites, while having little or no effect on the binding of Lrp to activator sites. This differential effect of alanine and leucine on Lrp binding helps to explain how these modifiers influence both repression and activation of the dad operon.