Protein farnesyltransferase catalyzes isoprenylation of the cysteine four residues from the C-terminus of several proteins including p21ras. Farnesylation is required for the transforming activity of Ras, and many efforts are underway to develop inhibitors of farnesyltransferase. We have used nuclear magnetic resonance spectroscopy to determine the farnesyltransferase-bound conformation of a heptapeptide substrate, KTKCVFM, which competes for the modification of p21Ha-ras in an in vitro assay. Analysis of transferred nuclear Overhauser effects reveals that the CVFM sequence of the peptide substrate is directly involved in binding to the enzyme and adopts a type I beta-turn conformation in the bound state. The present structural information should aid in the design of more effective inhibitors of the enzyme and in understanding the nature of the peptide binding site.