The isolated N-terminal SH3 domain of the Drosophila adapter protein drk (drkN SH3 domain) exists in a dynamic equilibrium between a folded (F(exch)) and an unfolded (U(exch)) state under native-like buffer conditions [Zhang, O., & Forman-Kay, J. D. (1995) Biochemistry 34, 6784-6794]. The effect of binding a proline-rich peptide derived from the protein Sos, a biological target of the drkN SH3 domain, on this equilibrium has been investigated. The stabilization of the F(exch) folded state upon binding provides an example of the link between binding and protein folding or stabilization. We have compared NMR parameters of the U(exch) state with those of a denatured state in 2 M guanidine hydrochloride (U(Gdn)). Variable-temperature experiments demonstrate that interactions in a region encompassing residues Gln 23-Leu 28 in the U(exch) state are destabilized upon addition of guanidine hydrochloride. Data from an 15N HSQC-NOESY-HSQC experiment as well as recently developed methods provide more unambiguous structural information than described previously, showing the presence of preferential structure in both unfolded states. Backbone NOEs observed in both unfolded states as well as chemical shifts and coupling constants suggest a rapid equilibrium between extended structure and turn-like structures which may play a role in initiation of protein folding. However, differences in detailed structural features between the two unfolded states argue that caution is needed in interpretation of results from structural characterization of protein conformational states generated using denaturing conditions.