X-ray crystallography has been used to examine the binding of three members of the beta-lactam family of antibiotics to the D-alanyl-D-alanine peptidase from Streptomyces R61, a target of penicillins. Cephalosporin C, the monobactam analog of penicillin G and (2,3)-alpha-methylene benzylpenicillin have been mapped at 2.3 A resolution in the form of acyl-enzyme complexes bound to serine 62. On the basis of the positions of these inhibitors, the binding of a tripeptide substrate for the enzyme, L-lysyl-D-alanyl-D-alanine, has been modeled in the active site. The binding of both inhibitors and substrate is facilitated by hydrogen-bonding interactions with a conserved beta-strand (297-303), which is antiparallel to the beta-lactam's acylamide linkage or the substrate's peptide bond. The active site is similar to that in beta-lactamases.