The most widely distributed biosynthetic pathway to initiate phosphatidic acid formation in bacterial membrane phospholipid biosynthesis involves the conversion of acyl-acyl carrier protein to acylphosphate by PlsX and the transfer of the acyl group from acylphosphate to glycerol 3-phosphate by an integral membrane protein, PlsY. The membrane topology of Streptococcus pneumoniae PlsY was determined using the substituted cysteine accessibility method. PlsY has five membrane-spanning segments with the amino terminus and two short loops located on the external face of the membrane. Each of the three larger cytoplasmic domains contains a highly conserved sequence motif. Site-directed mutagenesis revealed that each conserved domain was critical for PlsY catalysis. Motif 1 had an essential serine and arginine residue. Motif 2 had the characteristics of a phosphate-binding loop. Mutations of the conserved glycines in motif 2 to alanines resulted in a Km defect for glycerol 3-phosphate binding leading to the conclusion that this motif corresponded to the glycerol 3-phosphate binding site. Motif 3 contained a conserved histidine and asparagine that were important for activity and a glutamate that was critical to the structural integrity of PlsY. PlsY was noncompetitively inhibited by palmitoyl-CoA. These data define the membrane architecture and the critical active site residues in the PlsY family of bacterial acyltransferases.