Kinesin-1 motor proteins move along microtubules in repetitive steps of 8 nm at the expense of ATP. To determine nucleotide dwell times during these processive runs, we used a Förster resonance energy transfer method at the single-molecule level that detects nucleotide binding to kinesin motor heads. We show that the fluorescent ATP analog used produces processive motility with kinetic parameters altered <2.5-fold compared with normal ATP. Using our confocal fluorescence kinesin motility assay, we obtained fluorescence intensity time traces that we then analyzed using autocorrelation techniques, yielding a time resolution of approximately 1 ms for the intensity fluctuations due to fluorescent nucleotide binding and release. To compare these experimental autocorrelation curves with kinetic models, we used Monte-Carlo simulations. We find that the experimental data can only be described satisfactorily on the basis of models assuming an alternating-site mechanism, thus supporting the view that kinesin's two motor domains hydrolyze ATP and step in a sequential way.