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Nitrogen fixation is how nitrogen in the air (N2) is changed (converted) into ammonia (NH3) or other nitrogenous compounds in the soil.
Nitrogen fixation is essential to life because nitrogen compounds are needed for making all nitrogen-containing organic compounds, such as amino acids, proteins, and nucleic acids.
Atmospheric nitrogen is a relatively unreactive molecule. It is useless to all except a few bacteria and archaea. Biological nitrogen fixation converts N2 into ammonia, which is used (metabolized) by most organisms.