A functional F0F1 ATP synthase that contains the endogenous inhibitor protein (F0F1I) was isolated by the use of two combined techniques [Adolfsen, R., McClung, J.A., and Moudrianakis, E. N. (1975). Biochemistry 14, 1727-1735; Dreyfus, G., Cells, H., and Ramirez, J. (1984). Anal. Biochem. 142, 215-220]. The preparation is composed of 18 subunits as judged by SDS-PAGE. A steady-state kinetic analysis of the latent ATP synthase complex at various concentrations of ATP showed a V-max of 1.28 mu mol min(-1) mg(-1), whereas the V-max of the complex without the inhibitor was 8.3 mu mol min(-1) mg(-1). In contrast, the K-m for Mg-ATP of F0F1I was 148 mu M, comparable to the K-m value of 142 mu M of the F0F1 complex devoid of IF1. The hydrolytic activity of the F0F1I increased severalfold by incubation at 60 degrees C at pH 6.8, reaching a maximal ATPase activity of 9.5 mu mol min(-1) mg(-1); at pH 9.0 a rapid increase in the specific activity of hydrolysis was followed by a sharp drop in activity. The latent ATP synthase was reconstituted into liposomes by means of a column filtration method. The proteoliposomes showed ATP-Pi exchange activity which responded to phosphate concentration and was sensitive to energy transfer inhibitors like oligomycin and the uncoupler p-trifluoromethoxyphenylhydrazone.