Replicative DNA polymerases use a complex, multistep mechanism for efficient and accurate DNA replication as uncovered by intense kinetic and structural studies. Recently, single-molecule fluorescence spectroscopy has provided new insights into real-time conformational dynamics utilized by DNA polymerases during substrate binding and nucleotide incorporation. We have employed single-molecule Forster Resonance Energy Transfer techniques to investigate the kinetics and conformational dynamics of Sulfolobus solfataricus DNA Polymerase B1 (PolB1) during DNA and nucleotide binding. Our experiments demonstrate that this replicative polymerase can bind to DNA in at least three conformations, corresponding to an open and closed conformation of the finger domain as well as a conformation with the DNA substrate bound to the exonuclease active site of PolB1. Additionally our results show that PolB1 can transition between these conformations without dissociating from a primer-template DNA substrate. Furthermore, we show that the closed conformation is promoted by a matched incoming dNTP but not by a mismatched dNTP and that mismatches at the primer-template terminus lead to an increase in the binding of the DNA to the exonuclease site. Our analysis has also revealed new details of the biphasic dissociation kinetics of the polymerase/DNA binary complex. Notably, comparison of the results obtained in this study with PolB1 to those from similar single-molecule studies with an A-family DNA polymerase suggests mechanistic differences between these polymerases. In summary, our findings provide novel mechanistic insights into protein conformational dynamics and substrate binding kinetics of a high-fidelity B-family DNA polymerase.