Sumoylation has recently been identified as an important mechanism that regulates protein interactions and localization in essential cellular functions, such as gene transcription, subnuclear structure formation, viral infection, and cell cycle progression. A SUMO binding amino acid sequence motif (SBM), which recognizes the SUMO moiety of modified proteins in sumoylation-dependent cellular functions, has been consistently identified by several recent studies. To understand the mechanism of SUMO recognition by the SBM, we have solved the solution structure of SUMO-1 in complex with a peptide containing the SBM derived from the protein PIASX (KVDVIDLTIESSSDEEEDPPAKR). Surprisingly, the structure reveals that the bound orientation of the SBM can reverse depending on the sequence context. The structure also reveals a novel mechanism of recognizing target sequences by a ubiquitin-like module. Unlike ubiquitin binding motifs, which all form helices and bind to the main beta-sheet of ubiquitin, the SBM forms an extended structure that binds between the alpha-helix and a beta-strand of SUMO-1. This study provides a clear mechanism of the SBM sequence variations and its recognition of the SUMO moiety in sumoylated proteins.