Ketosynthase-like decarboxylase (KSQ) domains are widely distributed in the loading modules of modular polyketide synthases (PKSs) and are proposed to catalyze the decarboxylation of a malonyl or methylmalonyl unit for the construction of the PKS starter unit. KSQ domains have high sequence similarity to ketosynthase (KS) domains, which catalyze transacylation and decarboxylative condensation in polyketide and fatty acid biosynthesis, except that the catalytic Cys residue of KS domains is replaced by Gln in KSQ domains. Here, we present biochemical analyses of GfsA KSQ and CmiP4 KSQ, which are involved in the biosynthesis of FD-891 and cremimycin, respectively. In vitro analysis showed that these KSQ domains catalyze the decarboxylation of malonyl and methylmalonyl units. Furthermore, we determined the crystal structure of GfsA KSQ in complex with a malonyl thioester substrate analogue, which enabled identification of key amino acid residues involved in the decarboxylation reaction. The importance of these residues was confirmed by mutational analysis. On the basis of these findings, we propose a mechanism of the decarboxylation reaction catalyzed by GfsA KSQ. GfsA KSQ initiates decarboxylation by fixing the substrate in a suitable conformation for decarboxylation. The formation of enolate upon decarboxylation is assisted by two conserved threonine residues. Comparison of the structure of GfsA KSQ with those of KS domains suggests that the Gln residue in the active site of the KSQ domain mimics the acylated Cys residue in the active site of KS domains.