Several genera of N2-fixing bacteria establish symbiotic associations with plants. Among these, the genus Rhizobium has the most significant contribution, in terms of yield, in many important crop plants. The establishment of the Rhizobium-legume symbiosis is a very complex process involving many genes which need to be co-ordinately regulated. In the first instance, plant signal molecules, known to be flavonoids, trigger the expression of host-specific genes in the bacterial partner through the action of the regulatory NodD protein. In response to these signals, Rhizobium bacteria synthesize lipo-oligosaccharide molecules which in turn cause cell differentiation and nodule development. Once the nodule has formed, Rhizobium cells differentiate into bacteroids and another set of genes is activated. These genes, designated nif and fix, are responsible for N2 fixation. In this system, several regulatory proteins are involved in a complex manner, the most important being NifA and a two component (FixK and FixL) regulatory system. Our knowledge about the establishment of these symbioses has advanced recently, although there are many questions yet to be solved.