How 6R-tetrahydrobiopterin (H(4)B) participates in Arg hydroxylation as catalyzed by the nitric oxide synthases (NOSs) is a topic of current interest. Previous work with the oxygenase domain of inducible NOS (iNOSoxy) demonstrated that H(4)B radical formation is kinetically coupled to disappearance of an initial heme-dioxy intermediate and to Arg hydroxylation in a single turnover reaction run at 10 degrees C [Wei, C.-C., Wang, Z.-Q., Wang, Q., Meade, A. L., Hemann, C., Hille, R., and Stuehr, D. J. (2001) J. Biol. Chem. 276, 315-319]. Here we used 5-methyl-H(4)B to investigate how pterin structure influences radical formation and associated catalytic steps. In the presence of Arg, the heme-dioxy intermediate in 5-methyl-H(4)B-bound iNOSoxy reacted at a rate of 35 s(-)(1), which is 3-fold faster than with H(4)B. This was coupled to a faster rate of 5-methyl-H(4)B radical formation (40 vs 12.5 s(-)(1)) and to a faster and more productive Arg hydroxylation. The EPR spectrum of the enzyme-bound 5-methyl-H(4)B radical had different hyperfine structure than the bound H(4)B radical and exhibited a 3-fold longer half-life after its formation. A crystal structure of 5-methyl-H(4)B-bound iNOSoxy revealed that there are minimal changes in conformation of the bound pterin or in its interactions with the protein as compared to H(4)B. Together, we conclude the following: (1) The rate of heme-dioxy reduction is linked to pterin radical formation and is sensitive to pterin structure. (2) Faster heme-dioxy reduction increases the efficiency of Arg hydroxylation but still remains rate limiting for the reaction. (3) The 5-methyl group influences heme-dioxy reduction by altering the electronic properties of the pterin rather than changing protein structure or interactions. (4) Faster electron transfer from 5-methyl-H(4)B may be due to increased radical stability afforded by the N-5 methyl group.