Bacillus subtilis PaiA has been implicated in the negative control of sporulation as well as production of degradative enzymes. PaiA shares recognizable sequence homology with N-acetyltransferases, including those that can acetylate spermidine/spermine substrates. We have determined the crystal structure of PaiA in complex with CoA at 1.9 A resolution and found that PaiA is a member of the N-acetyltransferase superfamily of enzymes. Unexpectedly, we observed the binding of an oxidized CoA dimer in the active site of PaiA, and the structural information suggests the substrates of the enzyme could be linear, positively charged compounds. Our biochemical characterization is also consistent with this possibility, since purified PaiA possesses N1-acetyltransferase activity toward polyamine substrates including spermidine and spermine. Further, conditional overexpression of PaiA in bacteria results in increased acetylation of endogenous spermidine pools. Thus, our structural and biochemical analyses indicate that PaiA is a novel N-acetyltransferase capable of acetylating both spermidine and spermine. In this way, the pai operon may function in regulating intracellular polyamine concentrations and/or binding capabilities. In addition to preventing toxicity due to polyamine excess, this function may also serve to regulate expression of certain bacterial gene products such as those involved in sporulation.