In specific plant organs, namely the root nodules of alfalfa, fixed nitrogen (ammonia) produced by the symbiotic partner Sinorhizobium meliloti supports the growth of the host plant in nitrogen-depleted environment. Here, we report that a derivative of S. meliloti carrying a mutation in the chromosomal ntrR gene induced nodules with enhanced nitrogen fixation capacity, resulting in an increased dry weight and nitrogen content of alfalfa. The efficient nitrogen fixation is a result of the higher expression level of the nifH gene, encoding one of the subunits of the nitrogenase enzyme, and nifA, the transcriptional regulator of the nif operon. The ntrR gene, controlled negatively by its own product and positively by the symbiotic regulator syrM, is expressed in the same zone of nodules as the nif genes. As a result of the nitrogen-tolerant phenotype of the strain, the beneficial effect of the mutation on efficiency is not abolished in the presence of the exogenous nitrogen source. The ntrR mutant is highly competitive in nodule occupancy compared with the wild-type strain. Sequence analysis of the mutant region revealed a new cluster of genes, termed the "ntrPR operon," which is highly homologous to a group of vap-related genes of various pathogenic bacteria that are presumably implicated in bacterium-host interactions. On the basis of its favorable properties, the strain is a good candidate for future agricultural utilization.