Phospholipase A(2) (PLA(2)) (E. C. 3.1.1.4) is a common enzyme in the two-way cascade mechanism leading to the production of proinflammatory compounds known as eicosanoids. The binding of phospholipase A(2) to the membrane surface and hydrolysis of phospholipids are thought to involve the formation of a hydrophobic channel into which a single substrate molecule diffuses before its cleavage. To regulate the production of proinflammatory compounds, a specific peptide inhibitor Val-Ala-Phe-Arg-Ser (VAFRS) for the group I PLA(2) enzymes has been designed and synthesized. PLA(2) was isolated from Indian cobra (Naja naja sagittifera) venom and purified to homogeneity. The binding studies indicated the K(i) value of 1.02 +/- 0.10 x 10(-8) M. The purified PLA(2) samples and the designed inhibitor VAFRS were cocrystallized. The crystal structure of the complex was determined and refined to 1.9 A resolution. The peptide binds to PLA(2) at the active site and fills the hydrophobic channel completely. However, its placement with respect to the channel is in the opposite direction as compared to those observed in group II PLA(2)'s. Furthermore, the predominant intermolecular interactions involve strong electrostatic interactions between the side chains of peptide Arg and Asp 49 of PLA(2) together with a number of van der Waals interactions with other residues. A good number of observed interactions between the peptide and the protein indicate the significance of a structure-based drug design approach. The novel factor in the present sequence of the peptide is related to the introduction of a positively charged residue at the C-terminal part of the peptide.