Tarocystatin (CeCPI) from taro (Colocasia esculenta cv. Kaohsiung no. 1), a group-2 phytocystatin, shares a conserved N-terminal cystatin domain (NtD) with other phytocystatins but contains a C-terminal cystatin-like extension (CtE). The structure of the tarocystatin-papain complex and the domain interaction between NtD and CtE in tarocystatin have not been determined. We resolved the crystal structure of the phytocystatin-papain complex at resolution 2.03 Å. Surprisingly, the structure of the NtD-papain complex in a stoichiometry of 1:1 could be built, with no CtE observed. Only two remnant residues of CtE could be built in the structure of the CtE-papain complex. Therefore, CtE is easily digested by papain. To further characterize the interaction between NtD and CtE, three segments of tarocystatin, including the full-length (FL), NtD and CtE, were used to analyze the domain-domain interaction and the inhibition ability. The results from glutaraldehyde cross-linking and yeast two-hybrid assay indicated the existence of an intrinsic flexibility in the region linking NtD and CtE for most tarocystatin molecules. In the inhibition activity assay, the glutathione-S-transferase (GST)-fused FL showed the highest inhibition ability without residual peptidase activity, and GST-NtD and FL showed almost the same inhibition ability, which was higher than with NtD alone. On the basis of the structures, the linker flexibility and inhibition activity of tarocystatins, we propose that the overhangs from the cystatin domain may enhance the inhibition ability of the cystatin domain against papain.