Gram-negative bacteria express a diverse array of lipoproteins that are essential for various aspects of cell growth and virulence, including nutrient uptake, signal transduction, adhesion, conjugation, sporulation, and outer membrane protein folding. Lipoprotein maturation requires the sequential activity of three enzymes that are embedded in the cytoplasmic membrane. First, phosphatidylglycerol: prolipoprotein diacylglyceryl transferase (Lgt) recognizes a conserved lipobox motif within the prolipoprotein signal sequence and catalyzes the addition of diacylglycerol to an invariant cysteine. The signal sequence is then cleaved by signal peptidase II (LspA) to give an N-terminal S-diacylglyceryl cysteine. Finally, apolipoprotein N-acyltransferase (Lnt) catalyzes the transfer of the sn-1-acyl chain of phosphatidylethanolamine to this N-terminal cysteine, generating a mature, triacylated lipoprotein. Although structural studies of Lgt and LspA have yielded significant mechanistic insights into this essential biosynthetic pathway, the structure of Lnt has remained elusive. Here, we present crystal structures of wild-type and an activesite mutant of Escherichia coli Lnt. The structures reveal a monomeric eight-transmembrane helix fold that supports a periplasmic carbonnitrogen hydrolase domain containing a Cys-Glu-Lys catalytic triad. Two lipids are bound at the active site in the structures, and we propose a putative phosphate recognition site where a chloride ion is coordinated near the active site. Based on these structures and complementary cell-based, biochemical, and molecular dynamics approaches, we propose a mechanism for substrate engagement and catalysis by E. coli Lnt.lipoprotein biosynthesis | apolipoprotein N-acyltransferase | crystal structure | enzyme mechanism T he essential outer membrane (OM) of Gram-negative bacteria has a distinct composition, containing a diverse set of phospholipids, lipopolysaccharides, OM proteins, and lipoproteins (1). Escherichia coli expresses at least 90 lipoproteins that play critical roles in multiple cellular processes ranging from OM biogenesis to cell division and virulence (2). A common feature of these proteins is an N-terminal N-acyl, S-diacylglyceryl cysteine, which ensures their proper localization (3, 4). Before triacylation, preprolipoproteins are translated in the cytoplasm and transferred across the inner bacterial membrane via the Sec or Tat pathway machineries (5). These nascent preprolipoproteins have an N-terminal hydrophobic signal peptide that contains a conserved lipobox motif with the consensus sequence [LVI] -3 [ASTVI][GAS]C +1 , which directs them to the lipoprotein biosynthetic pathway (6-8). The maturation of lipoproteins is then catalyzed by the consecutive action of three essential integral membrane proteins (Fig. 1A). In the first step of this pathway, phosphatidylglycerol:prolipoprotein diacylglyceryl transferase (Lgt) catalyzes the covalent attachment of the sn-1,2-diacylglyceryl group from phosphatidylglycerol to the sulfydryl group of the ...