The structure of the antifungal drug 5-hydroxy-4-oxonorvaline (HON) in complex with its target homoserine dehydrogenase (HSD) has been determined by X-ray diffraction to 2.6 A resolution. HON shows potent in vitro and in vivo activity against various fungal pathogens despite its weak (2 mM) affinity for HSD in the steady state. The structure together with structure-activity relationship studies, mass spectrometry experiments, and spectroscopic data reveals that the molecular mechanism of antifungal action conferred by HON involves enzyme-dependent formation of a covalent adduct between C4 of the nicotinamide ring of NAD(+) and C5 of HON. Furthermore, novel interactions are involved in stabilizing the (HON*NAD)-adduct, which are not observed in the enzyme's ternary complex structure. These findings clarify the apparent paradox of the potent antifungal actions of HON given its weak steady-state inhibition characteristics.