beta1,4-Galactosyltransferase I (Gal-T1) normally transfers Gal from LTDP-Gal to GlcNAc in the presence of Mn2+ ion. In the presence of alpha-lactalbumin (LA), the Gal acceptor specificity is altered from GlcNAc to Glc. Gal-T1 also transfers GaINAc from UDP-Ga1NAc to Glc-NAc, but with only similar to0.1% of Gal-T activity. To understand this low GaINAc-transferase activity, we have carried out the crystal structure analysis of the Gal-T1(.)LA complex with UDP-GalNAc at 2.1-Angstrom resolution. The crystal structure reveals that the LTDP-GalNAc binding to Gal-T1 is similar to the binding of LTDP-Gal to Gal-T1, except for an additional hydrogen bond formed between the N-acetyl group of GaINAc moiety with the Tyr-289 side chain hydroxyl group. Elimination of this additional hydrogen bond by mutating Tyr-289 residue to Leu, Ile, or Asn enhances the GaINAc-transferase activity. Although all three mutants exhibit enhanced GalNAc-transferase activity, the mutant Y289L exhibits GalNAc-transferase activity that is nearly 100% of its Gal-T activity, even while completely retaining its Gal-T activity. The steady state kinetic analyses on the Leu-289 mutant indicate that the K-m for GlcNAc has increased compared to the wild type. On the other hand, the catalytic constant (k(cat)) in the Gal-T reaction is comparable with the wild type, whereas it is 3-5-fold higher in the GaINAc-T reaction. Interestingly, in the presence of LA, these mutants also transfer GaINAc to Glc instead of to GlcNAc. The present study demonstrates that, in the Gal-T family, the Tyr-289/Phe-289 residue largely determines the sugar donor specificity.