F1-ATPase is the catalytic complex of rotary nanomotor ATP synthases. Bacterial ATP synthases can be autoinhibited by the C-terminal domain of subunit ε, which partially inserts into the enzyme's central rotor cavity to block functional subunit rotation. Using a kinetic, optical assay of F1·ε binding and dissociation, we show that formation of the extended, inhibitory conformation of ε (εX) initiates after ATP hydrolysis at the catalytic dwell step. Prehydrolysis conditions prevent formation of the εX state, and post-hydrolysis conditions stabilize it. We also show that ε inhibition and ADP inhibition are distinct, competing processes that can follow the catalytic dwell. We show that the N-terminal domain of ε is responsible for initial binding to F1 and provides most of the binding energy. Without the C-terminal domain, partial inhibition by the ε N-terminal domain is due to enhanced ADP inhibition. The rapid effects of catalytic site ligands on conformational changes of F1-bound ε suggest dynamic conformational and rotational mobility in F1 that is paused near the catalytic dwell position.