The structure of TEM-1 beta-lactamase complexed with the inhibitor BLIP has been determined at 1.7 Angstrom resolution. The two tandemly repeated domains of BLIP form a polar, concave surface that docks onto a predominantly polar, convex protrusion on the enzyme, The ability of BLIP to adapt to a Variety of class A beta-lactamases is most likely due to an observed flexibility between the two domains of the inhibitor and to an extensive layer of water molecules entrapped between the enzyme and inhibitor, A beta-hairpin loop from domain 1 of BLIP is inserted into the active site of the beta-lactamase. The carboxylate of Asp 49 forms hydrogen bonds to four conserved, catalytic residues in the beta-lactamase, thereby mimicking the position of the penicillin G carboxylate observed in the acyl-enzyme complex of TEM-1 with substrate, This beta-hairpin may serve as a template with which to create a new family of peptide-analogue beta-lactamase inhibitors.