Z-DNA is produced in a long genomic DNA by Z-DNA binding proteins, through formation of two B-Z junctions with the extrusion of one base pair from each junction. To answer the question of how Z-DNA binding proteins induce B-Z transitions in CG-rich segments while maintaining the B-conformation of surrounding segments, we investigated the kinetics and thermodynamics of base-pair openings of a 13-bp DNA in complex with the Z-DNA binding protein, Z alpha(ADAR1). We also studied perturbations in the backbone of Z alpha(ADAR1) upon binding to DNA. Our study demonstrates the initial contact conformation as an intermediate structure during B-Z junction formation induced by Z alpha(ADAR1) in which the Z alpha(ADAR1) protein displays unique backbone conformational changes, but the 13-bp DNA duplex maintains the B-form helix. We also found the unique structural features of the 13-bp DNA duplex in the initial contact conformation: (i) instability of the AT-rich region II and (ii) longer lifetime for the opening state of the CG-rich region I. Our findings suggest a three-step mechanism of B-Z junction formation; (i) Z alpha(ADAR1) specifically interacts with a CG-rich DNA segment maintaining B-form helix via a unique conformation; (ii) the neighboring AT-rich region becomes very unstable, and the CG-rich DNA segment is easily converted to Z-DNA; and (iii) the AT-rich regions are base-paired again, and the B-Z junction structure is formed.