Sau3AI is a type II restriction enzyme that recognizes the 5'-GATC-3' sequence in double-strand DNA and cleaves at 5' to the G residue. The C-terminal domain of Sau3AI (Sau3AI-C), which contains amino acids from 233 to 489, was crystallized and its structure was solved by using the Multi-wavelength Anomalous Diffraction method. The Sau3AI-C structure at 1.9 A resolution is similar to the structure of MutH, a DNA mismatch repair protein that shares high sequence similarity with the N-terminal Sau3AI domain. The functional analysis shows that Sau3AI-C can bind DNA with one recognition sequence but has no cleavage activity. These results indicate that Sau3AI is a pseudo-dimer belonging to the type IIe restriction enzymes and the Sau3AI-C is the allosteric effector domain that assists DNA binding and cleavage.