The translocation (T)-domain plays a key role in the action of diphtheria toxin and is responsible for transferring the catalytic domain across the endosomal membrane into the cytosol in response to acidification. Deciphering the molecular mechanism of pH-dependent refolding and membrane insertion of the T-domain, which is considered to be a paradigm for cell entry of other bacterial toxins, reveals general physicochemical principles underlying membrane protein assembly and signaling on membrane interfaces. Structure-function studies along the T-domain insertion pathway have been affected by the presence of multiple conformations at the same time, which hinders the application of high-resolution structural techniques. Here, we review recent progress in structural, functional and thermodynamic studies of the T-domain archived using a combination of site-selective fluorescence labeling with an array of spectroscopic techniques and computer simulations. We also discuss the principles of conformational switching along the insertion pathway revealed by studies of a series of T-domain mutants with substitutions of histidine residues.