The terminase of bacteriophage SPP1, constituted by a large (G2P) and a small (G1P) subunit, is essential for the initiation of DNA packaging. A hexa-histidine G2P (H6-G2P), which is functional in vivo, possesses endonuclease, ATPase, and double-stranded DNA binding activities. H6-G2P introduces a cut with preference at the 5'-RCGG downward arrowCW-3' sequence. Distamycin A, which is a minor groove binder that mimics the architectural structure generated by G1P at pac, enhances the specific cut at both bona fide 5'-CTATTGCGG downward arrowC-3' sequences within pacC of SPP1 and SF6 phages. H6-G2P hydrolyzes rATP or dATP to the corresponding rADP or dADP and P(i). H6-G2P interacts with two discrete G1P domains (I and II). Full-length G1P and G1PDeltaN62 (lacking domain I) stimulate 3.5- and 1.9-fold, respectively, the ATPase activity of H6-G2P. The results presented suggest that a DNA structure, artificially promoted by distamycin A or facilitated by the assembly of G1P at pacL and/or pacR, stimulates H6-G2P cleavage at both target sites within pacC. In the presence of two G1P decamers per H6-G2P monomer, the H6-G2P endonuclease is repressed, and the ATPase activity stimulated. Based on these results, we propose a model that can account for the role of terminase in headful packaging.