A high-resolution structure of a ligand-bound, soluble form of human monoglyceride lipase (MGL) is presented. The structure highlights a novel conformation of the regulatory lid-domain present in the lipase family as well as the binding mode of a pharmaceutically relevant reversible inhibitor. Analysis of the structure lacking the inhibitor indicates that the closed conformation can accommodate the native substrate 2-arachidonoyl glycerol. A model is proposed in which MGL undergoes conformational and electrostatic changes during the catalytic cycle ultimately resulting in its dissociation from the membrane upon completion of the cycle. In addition, the study outlines a successful approach to transform membrane associated proteins, which tend to aggregate upon purification, into a monomeric and soluble form.