Lipid A (also known as endotoxin) is the hydrophobic portion of lipopolysaccharides. It is an essential membrane component required for the viability of gram-negative bacteria. The enzymes involved in its biosynthesis are attractive targets for the development of novel antibiotics. LpxH catalyzes the fourth step of the lipid A biosynthesis pathway and cleaves the pyrophosphate bond of UDP-2,3-diacylglucosamine to yield 2,3-diacylglucosamine 1-phosphate (lipid X) and UMP. Here we present the structures of LpxH from Pseudomonas aeruginosa (PaLpxH). PaLpxH consists of two domains: a catalytic domain that is homologous to the metallophosphoesterases and a helical insertion domain. Lipid X was captured in the crevice between these two domains, with its phosphate group facing the dinuclear metal (Mn(2+)) center and two acyl chains buried in the hydrophobic cavity. The structures reveal that a large conformational change occurs at the lipid X binding site surface upon the binding/release of the product molecule. Based on these observations, we propose a novel model for lipid X embedding, which involves the scissor-like movement of helix α6, resulting in the release of lipid X into the lipid bilayer.