The crystal structures of Flavobacterium heparinium chondroitin AC lyase (chondroitinase AC; EC 126.96.36.199) bound to dermatan sulfate hexasaccharide (DS(hexa)), tetrasaccharide (DS(tetra)), and hyaluronic acid tetrasaccharide (HA(tetra)) have been refined at 2.0, 2.0, and 2.1 A resolution, respectively. The structure of the Tyr234Phe mutant of AC lyase bound to a chondroitin sulfate tetrasaccharide (CS(tetra)) has also been determined to 2.3 A resolution. For each of these complexes, four (DS(hexa) and CS(tetra)) or two (DS(tetra) and HA(tetra)) ordered sugars are visible in electron density maps. The lyase AC DS(hexa) and CS(tetra) complexes reveal binding at four subsites, -2, -1, +1, and +2, within a narrow and shallow protein channel. We suggest that subsites -2 and -1 together represent the substrate recognition area, +1 is the catalytic subsite and +1 and +2 together represent the product release area. The putative catalytic site is located between the substrate recognition area and the product release area, carrying out catalysis at the +1 subsite. Four residues near the catalytic site, His225, Tyr234, Arg288, and Glu371 together form a catalytic tetrad. The mutations His225Ala, Tyr234Phe, Arg288Ala, and Arg292Ala, revealed residual activity for only the Arg292Ala mutant. Structural data indicate that Arg292 is primarily involved in recognition of the N-acetyl and sulfate moieties of galactosamine, but does not participate directly in catalysis. Candidates for the general base, removing the proton attached to C-5 of the glucuronic acid at the +1 subsite, are Tyr234, which could be transiently deprotonated during catalysis, or His225. Tyrosine 234 is a candidate to protonate the leaving group. Arginine 288 likely contributes to charge neutralization and stabilization of the enolate anion intermediate during catalysis.