An understanding of how conformational dynamics modulates function and catalysis of human monoacylglycerol lipase (hMGL), an important pharmaceutical target, can facilitate the development of novel ligands with potential therapeutic value. Here, we report the discovery and characterization of an allosteric, regulatory hMGL site comprised of residues Trp-289 and Leu-232 that reside over 18 Å away from the catalytic triad. These residues were identified as critical mediators of long-range communication and as important contributors to the integrity of the hMGL structure. Nonconservative replacements of Trp-289 or Leu-232 triggered concerted motions of structurally distinct regions with a significant conformational shift toward inactive states and dramatic loss in catalytic efficiency of the enzyme. Using a multimethod approach, we show that the dynamically relevant Trp-289 and Leu-232 residues serve as communication hubs within an allosteric protein network that controls signal propagation to the active site, and thus, regulates active-inactive interconversion of hMGL. Our findings provide new insights into the mechanism of allosteric regulation of lipase activity, in general, and may provide alternative drug design possibilities.