The mitochondrial NAD-dependent methylenetetrahydrofolate dehydrogenase-cyclohydrolase (NMDMC) is believed to have evolved from a trifunctional NADP-dependent methylenetetrahydrofolate dehydrogenase-cyclohydrolase-synthetase. It is unique in its absolute requirement for inorganic phosphate and magnesium ions to support dehydrogenase activity. To enable us to investigate the roles of these ions, a homology model of human NMDMC was constructed based on the structures of three homologous proteins. The model supports the hypothesis that the absolutely required inorganic phosphate (Pi) can bind in close proximity to the 2’-hydroxyl of NAD, through interactions with R166 and R198. The characterization of mutants of R166, D190 and R198 show that R166 is primarily responsible for Pi binding while R198 plays a secondary role, assisting in binding and properly orienting the ion in the cofactor binding site. D190 helps to properly position R166. Mutants of D133 suggest that the magnesium ion interacts with both Pi and the aspartate side chain, and plays a role in positioning Pi and NAD. NMDMC uses Pi and magnesium to adapt an NADP binding site for NAD binding. This adaptation represents a novel variation of the classic Rossmann fold.