Involved in the biosynthesis of branched-chain amino acids (BCAA). Catalyzes an alkyl-migration followed by a ketol-acid reduction of (S)-2-acetolactate (S2AL) to yield (R)-2,3-dihydroxy-isovalerate. In the isomerase reaction, S2AL is rearranged via a Mg-dependent methyl migration to produce 3-hydroxy-3-methyl-2-ketobutyrate (HMKB). In the reductase reaction, this 2-ketoacid undergoes a metal-dependent reduction by NADPH or NADH to yield (R)-2,3-dihydroxy-isovalerate. It is able to use both NADPH and NADH, but has a preference for NADH. (2R)-2,3-dihydroxy-3-methylbutanoate + NAD(+) = (2S)-2-acetolactate + H(+) + NADH (2R)-2,3-dihydroxy-3-methylbutanoate + NADP(+) = (2S)-2-acetolactate + H(+) + NADPH Binds 2 magnesium ions per subunit. kcat is 0.1 sec(-1) for reductoisomerase activity with NADH (at pH 7 with S2AL as substrate). kcat is 0.04 sec(-1) for reductoisomerase activity with NADPH (at pH 7 with S2AL as substrate). Amino-acid biosynthesis; L-isoleucine biosynthesis; L-isoleucine from 2-oxobutanoate: step 2/4. Amino-acid biosynthesis; L-valine biosynthesis; L-valine from pyruvate: step 2/4. Belongs to the ketol-acid reductoisomerase family.