Beta-ketoacyl-acyl carrier protein (ACP) synthase enzymes join short carbon units to construct fatty acyl chains by a three-step Claisen condensation reaction. The reaction starts with a trans thioesterification of the acyl primer substrate from ACP to the enzyme. Subsequently, the donor substrate malonyl-ACP is decarboxylated to form a carbanion intermediate, which in the third step attacks C1 of the primer substrate giving rise to an elongated acyl chain. A subgroup of beta-ketoacyl-ACP synthases, including mitochondrial beta-ketoacyl-ACP synthase, bacterial plus plastid beta-ketoacyl-ACP synthases I and II, and a domain of human fatty acid synthase, have a Cys-His-His triad and also a completely conserved Lys in the active site. To examine the role of these residues in catalysis, H298Q, H298E and six K328 mutants of Escherichia colibeta-ketoacyl-ACP synthase I were constructed and their ability to carry out the trans thioesterification, decarboxylation and/or condensation steps of the reaction was ascertained. The crystal structures of wild-type and eight mutant enzymes with and/or without bound substrate were determined. The H298E enzyme shows residual decarboxylase activity in the pH range 6-8, whereas the H298Q enzyme appears to be completely decarboxylation deficient, showing that H298 serves as a catalytic base in the decarboxylation step. Lys328 has a dual role in catalysis: its charge influences acyl transfer to the active site Cys, and the steric restraint imposed on H333 is of critical importance for decarboxylation activity. This restraint makes H333 an obligate hydrogen bond donor at Nepsilon, directed only towards the active site and malonyl-ACP binding area in the fatty acid complex.