␣-Amino acid ester hydrolases (AEHs) catalyze the hydrolysis and synthesis of esters and amides with an ␣-amino group. As such, they can synthesize -lactam antibiotics from acyl compounds and -lactam nuclei obtained from the hydrolysis of natural antibiotics. This article describes the gene sequence and the 1.9-Å resolution crystal structure of the AEH from Xanthomonas citri. The enzyme consists of an ␣/-hydrolase fold domain, a helical cap domain, and a jellyroll -domain. Structural homology was observed to the Rhodococcus cocaine esterase, indicating that both enzymes belong to the same class of bacterial hydrolases. Docking of a -lactam antibiotic in the active site explains the substrate specificity, specifically the necessity of an ␣-amino group on the substrate, and explains the low specificity toward the -lactam nucleus.-Lactam antibiotics form a large family of widely applied antibacterials. Most of them are derived from a handful of naturally occurring antibiotics like penicillin G, penicillin V, and cephalosporin C by replacing their acyl groups with synthetic ones. Initially, this was achieved by chemical means but at present, enzymatic methods are preferred (1). A well known enzyme used for these conversions is penicillin acylase (EC 3.5.1.11) from Escherichia coli. This enzyme is used both for the production of the -lactam nucleus 6-aminopenicillanic acid (6-APA) 1 by cleaving off phenylacetic acid from penicillin G and for the coupling of new acyl groups to 6-APA or other -lactam nuclei. Penicillin acylase is, however strongly inhibited by its product phenylacetic acid (2), which must therefore be removed before coupling of a new acyl group to the -lactam nucleus can take place. In addition, -lactam nuclei are not very stable at the alkaline pH optimum of penicillin acylase.By contrast, ␣-amino acid ester hydrolases (AEHs) do not have these disadvantages. These enzymes catalyze the hydrolysis and synthesis of esters and amides of ␣-amino acids exclusively, and do not attack the amide bond of a -lactam. They can be used to acylate a -lactam using an ester as acyl donor, as shown in Fig. 1. Because the AEHs require an ␣-amino group on the substrate, they are not inhibited by phenylacetic acid (3). Together with their ability to accept various -lactam nuclei without cleaving them, this makes them suitable for generating widely used antibiotics such as ampicillin, amoxicillin, and the cephalosporins cephadroxil and cephalexin. The slightly acidic pH optimum of AEH, which is beneficial for -lactam stability, is another advantage of AEHs for biocatalytic applications, as is their stereospecificity toward the acyl donor (4).One of the first AEHs that was isolated and characterized is the enzyme from Xanthomonas citri (5-11). This enzyme was found to be a homotetramer with subunits of 72 kDa (6). Kinetic studies indicated the occurrence of an acyl-enzyme intermediate in the hydrolysis and acylation reactions of -lactam antibiotics (3,7,12).This article reports the gene and 1.9-Å resolution ...