Treatment of Gram-negative bacterial infections with antimicrobial agents can cause release of the endotoxin lipopolysaccharide (LPS), the potent initiator of sepsis, which is the major cause of mortality in intensive care units worldwide. Structural information on peptides bound to LPS can lead to the development of more effective endotoxin neutralizers. Short linear antimicrobial and endotoxin-neutralizing peptide LF11, based on the human lactoferrin, binds to LPS, inducing a peptide fold with a "T-shaped" arrangement of a hydrophobic core and two clusters of basic residues that match the distance between the two phosphate groups of LPS. Side chain arrangement of LF11 bound to LPS extends the previously proposed LPS binding pattern, emphasizing the importance of both electrostatic and hydrophobic interactions in a defined geometric arrangement. In anionic micelles, the LF11 forms amphipathic conformation with a smaller hydrophobic core than in LPS, whereas in zwitterionic micelles, the structure is even less defined. Protection of tryptophan fluorescence quenching in the order SDS>LPS>DPC and hydrogen exchange protection indicates the decreasing extent of insertion of the N terminus and potential role of peptide plasticity in differentiation between bacterial and eukaryotic membranes.