Barley 2-cysteine peroxiredoxin (2-Cys Prx) was analyzed for peroxide reduction, quaternary structure, thylakoid attachment, and function as well as in vivo occurrence of the inactivated form, with emphasis on the role of specific amino acid residues. Data presented show the following. 1) 2-Cys Prx has a broad substrate specificity and reduces even complex lipid peroxides such as phosphatidylcholine dilineoyl hydroperoxide, although at low rates. 2) 2-Cys Prx partly becomes irreversibly oxidized by peroxide substrates during the catalytic cycle in a concentration-dependent manner, particularly by bulky hydroperoxides. 3) Using dithiothreitol and thioredoxin (Trx) as reductants, amino acids were identified that are important for peroxide reduction (Cys64, Arg140, and Arg163), regeneration by Trx (Cys185), and conformation changes from dimer to oligomer (Thr66, Trp99, and Trp189). 4) Oligomerization decreased the rate of Trx-dependent peroxide detoxification. 5) Comparison of PrxWT, W99L, and W189L using static and time-resolved LIF techniques demonstrated the contributions of the tryptophan residues and yielded information about their local environment. Data indicated protein dynamics in the catalytic site and the carboxyl terminus during the reduction-oxidation cycle. 6) Reduced and inactivated barley 2-Cys Prx oligomerized and attached to the thylakoid membrane in isolated chloroplasts. The in vivo relevance of inactivation was shown in leaves subjected to cold and wilting stress and during senescence. Based on these results, it is hypothesized that in addition to its function in peroxide detoxification, 2-Cys Prx may play a role as a structural redox sensor in chloroplasts.