Regulation of the IkappaB alpha and IkappaB beta proteins is critical for modulating NF-kappaB-directed gene expression. Both IkappaB alpha and IkappaB beta are substrates for cellular kinases that phosphorylate the amino and carboxy termini of these proteins and regulate their function. In this study, we utilized a biochemical fractionation scheme to purify a kinase activity which phosphorylates residues in the amino and carboxy termini of both IkappaB alpha and IkappaB beta. Peptide microsequence analysis by capillary high-performance liquid chromatography ion trap mass spectroscopy revealed that this kinase was the DNA-dependent protein kinase catalytic subunit (DNA-PKcs). DNA-PK phosphorylates serine residue 36 but not serine residue 32 in the amino terminus of IkappaB alpha and also phosphorylates threonine residue 273 in the carboxy terminus of this protein. To determine the biological relevance of DNA-PK phosphorylation of IkappaB alpha, murine severe combined immunodeficiency (SCID) cell lines which lack the DNA-PKcs gene were analyzed. Gel retardation analysis using extract prepared from these cells demonstrated constitutive nuclear NF-kappaB DNA binding activity, which was not detected in extracts prepared from SCID cells complemented with the human DNA-PKcs gene. Furthermore, IkappaB alpha that was phosphorylated by DNA-PK was a more potent inhibitor of NF-kappaB binding than nonphosphorylated IkappaB alpha. These results suggest that DNA-PK phosphorylation of IkappaB alpha increases its interaction with NF-kappaB to reduce NF-kappaB DNA binding properties.