TRPC1/4/5 channels are non-specific cation channels implicated in a wide variety of diseases, and TRPC1/4/5 inhibitors have recently entered clinical trials. However, fundamental and translational studies require a better understanding of TRPC1/4/5 channel regulation by endogenous and exogenous factors. Although several potent and selective TRPC1/4/5 modulators have been reported, the paucity of mechanistic insights into their modes-of-action remains a barrier to the development of new chemical probes and drug candidates. Xanthine-based modulators include the most potent and selective TRPC1/4/5 inhibitors described to date, as well as TRPC5 activators. Our previous studies suggest that xanthines interact with a, so far, elusive pocket of TRPC1/4/5 channels that is essential to channel gating. Here we report the structure of a small-molecule-bound TRPC1/4/5 channel-human TRPC5 in complex with the xanthine Pico145-to 3.0 Å. We found that Pico145 binds to a conserved lipid binding site of TRPC5, where it displaces a bound phospholipid. Our findings explain the mode-of-action of xanthine-based TRPC1/4/5 modulators, and suggest a structural basis for TRPC1/4/5 modulation by endogenous factors such as (phospho)lipids and Zn2+ ions. These studies lay the foundations for the structure-based design of new generations of TRPC1/4/5 modulators.