Cytosolic phospholipase A₂ initiates the biosynthesis of prostaglandins, leukotrienes, and platelet-activating factor (PAF), mediators of the pathophysiology of asthma and arthritis. Here, we report the X-ray crystal structure of human cPLA₂ at 2.5 Å. cPLA₂ consists of an N-terminal calcium-dependent lipid-binding/C2 domain and a catalytic unit whose topology is distinct from that of other lipases. An unusual Ser-Asp dyad located in a deep cleft at the center of a predominantly hydrophobic funnel selectively cleaves arachidonyl phospholipids. The structure reveals a flexible lid that must move to allow substrate access to the active site, thus explaining the interfacial activation of this important lipase.