Cd2+ exposure has been associated with neurodegenerative diseases and other pathologies, but the underlying mechanism through which it exerts toxic effects remain unresolved. Using calorimetric and spectroscopic techniques, we show that Cd2+ binds to EF-hands in DREAM (downstream regulatory element antagonist modulator) with an equilibrium dissociation constant of 89 ± 10 nM, which is superior to that determined for Ca2+ (Kd = 1000 nM). Analogous to Ca2+ binding, Cd2+ binding triggers changes in the protein secondary and tertiary structure, including increased exposure of the hydrophobic cavities, as determined using a fluorescent probe, 1-anilinonaphthalene-8-sulfonic acid. In addition, we demonstrate that Cd2+ binding modulates DREAM interactions with FITC-labeled peptides that mimic binding sites of DREAM effector proteins; helix-9 of presenilin-1, and site-1 and site 2 of potassium voltage channel 4.3 (residues 2-22 and 70-90, respectively). Cd2+ association with DREAM increases its affinity for helix 9 of presenilin roughly 30-times compared to metal-free DREAM. The DREAM affinity for site-1 and site 2 is elevated approximately 7 and 15 times, respectively, in the presence of Cd2+. The above results suggest that DREAM and probably other members of the neuronal calcium sensor family bind Cd2+ with an affinity that is superior to that for Ca2+ and the interactions between toxic Cd2+ and DREAM and other neuronal calcium sensors provide novel insight into the molecular mechanism of Cd2+ neurotoxicity.