We have solved the crystal structure of an mRNA capping enzyme at 2.5 A resolution. The enzyme comprises two domains with a deep, but narrow, cleft between them. The two molecules in the crystallographic asymmetric unit adopt very different conformations; both contain a bound GTP, but one protein molecule is in an open conformation while the other is in a closed conformation. Only in the closed conformation is the enzyme able to bind manganese ions and undergo catalysis within the crystals to yield the covalent guanylated enzyme intermediate. These structures provide direct evidence for a mechanism that involves a significant conformational change in the enzyme during catalysis.