Mammalian DNA ligases are composed of a conserved catalytic domain flanked by unrelated sequences. At the C-terminal end of the catalytic domain, there is a 16-amino acid sequence, known as the conserved peptide, whose role in the ligation reaction is unknown. Here we show that conserved positively charged residues at the C-terminal end of this motif are required for enzyme-AMP formation. These residues probably interact with the triphosphate tail of ATP, positioning it for nucleophilic attack by the active site lysine. Amino acid residues within the sequence RFPR, which is invariant in the conserved peptide of mammalian DNA ligases, play critical roles in the subsequent nucleotidyl transfer reaction that produces the DNA-adenylate intermediate. DNA binding by the N-terminal zinc finger of DNA ligase III, which is homologous with the two zinc fingers of poly(ADP-ribose) polymerase, is not required for DNA ligase activity in vitro or in vivo. However, this zinc finger enables DNA ligase III to interact with and ligate nicked DNA at physiological salt concentrations. We suggest that in vivo the DNA ligase III zinc finger may displace poly(ADP-ribose) polymerase from DNA strand breaks, allowing repair to occur.