Dihydroxyacid dehydratase that catalyzes the third step in the common pathway leading to biosynthesis of branched-chain amino acids (PubMed:20008079, PubMed:21798060, PubMed:21987576, PubMed:22954227, PubMed:25280745, PubMed:26543501, PubMed:27532773, PubMed:28505306, PubMed:31303893, PubMed:30850698, PubMed:33620449, PubMed:8299945). Catalyzes the dehydration of (2R,3R)-2,3-dihydroxy-3-methylpentanoate (2,3-dihydroxy-3-methylvalerate) into 2-oxo-3-methylpentanoate (2-oxo-3-methylvalerate) and of (2R)-2,3-dihydroxy-3-methylbutanoate (2,3-dihydroxyisovalerate) into 2-oxo-3-methylbutanoate (2-oxoisovalerate), the penultimate precursor to L-isoleucine and L-valine, respectively (PubMed:27532773, PubMed:20008079). Required for the synthesis of alpha-isopropylmalate which modulates the activity of LEU3 and subsequently regulates the expression of LEU1 (PubMed:20008079). (2R)-2,3-dihydroxy-3-methylbutanoate = 3-methyl-2-oxobutanoate + H2O (2R,3R)-2,3-dihydroxy-3-methylpentanoate = (S)-3-methyl-2-oxopentanoate + H2O Binds 1 [2Fe-2S] cluster per subunit. Catalytic activity is inactivated under iron-limiting conditions. Amino-acid biosynthesis; L-isoleucine biosynthesis; L-isoleucine from 2-oxobutanoate: step 3/4. Amino-acid biosynthesis; L-valine biosynthesis; L-valine from pyruvate: step 3/4. Expression is significantly repressed when the pH changes from pH 5.0 to 3.0. Strongly reduces the iron responsiveness of expression of LEU1 by affecting the synthesis of alpha-isopropylmalate. The branched chain alcohol isobutanol exhibits superior physicochemical properties as an alternative biofuel (PubMed:21798060, PubMed:22954227, PubMed:25280745, PubMed:26543501, PubMed:28505306, PubMed:31303893, PubMed:30850698). Overexpression of isobutanol pathway enzymes such as ILV3 can enhance production of alcohol precursors and are of great interest for biofuel production (PubMed:21798060, PubMed:22954227, PubMed:25280745, PubMed:26543501, PubMed:28505306, PubMed:31303893, PubMed:30850698). Present with 171000 molecules/cell in log phase SD medium. Belongs to the IlvD/Edd family.