Phenomycin is a bacterial mini-protein of 89 amino acids discovered more than 50 years ago with toxicity in the nanomolar regime towards mammalian cells. The protein inhibits the function of the eukaryotic ribosome in cell free systems and appears to target translation initiation. Several fundamental questions concerning the cellular activity of phenomycin have however remained unanswered. In this paper, we have used morphological profiling to show that direct inhibition of translation underlies the toxicity of phenomycin in cells. We have performed studies of the cellular uptake mechanism of phenomycin, showing that endosomal escape is the toxicity-limiting step, and we have solved a solution phase high-resolution structure of the protein using NMR spectroscopy. Through bioinformatic as well as functional comparisons between phenomycin and two homologs, we have identified a peptide segment, which constitutes one of two loops in the structure, that is critical for the toxicity of phenomycin.