The recruitment of trafficking and signaling proteins to membranes containing phosphatidylinositol 3-phosphate [PtdIns(3)P] is mediated by FYVE domains. Here, the solution structure of the FYVE domain of the early endosome antigen 1 protein (EEA1) in the free state was compared with the structures of the domain complexed with PtdIns(3)P and mixed micelles. The multistep binding mechanism involved nonspecific insertion of a hydrophobic loop into the lipid bilayer, positioning and activating the binding pocket. Ligation of PtdIns(3)P then induced a global structural change, drawing the protein termini over the bound phosphoinositide by extension of a hinge. Specific recognition of the 3-phosphate was determined indirectly and directly by two clusters of conserved arginines.