TERs (trans-2-enoyl-CoA reductases; EC 1.3.1.44), which specifically catalyse the reduction of crotonyl-CoA to butyryl-CoA using NADH as cofactor, have recently been applied in the design of robust synthetic pathways to produce butan-1-ol as a biofuel. We report in the present paper the characterization of a CaTER (a TER homologue in Clostridium acetobutylicum), the structures of CaTER in apo form and in complexes with NADH and NAD+, and the structure of TdTER (Treponema denticola TER) in complex with NAD+. Structural and sequence comparisons show that CaTER and TdTER share approximately 45% overall sequence identity and high structural similarities with the FabV class enoyl-acyl carrier protein reductases in the bacterial fatty acid synthesis pathway, suggesting that both types of enzymes belong to the same family. CaTER and TdTER function as monomers and consist of a cofactor-binding domain and a substrate-binding domain with the catalytic active site located at the interface of the two domains. Structural analyses of CaTER together with mutagenesis and biochemical data indicate that the conserved Glu75 determines the cofactor specificity, and the conserved Tyr225, Tyr235 and Lys244 play critical roles in catalysis. Upon cofactor binding, the substrate-binding loop changes from an open conformation to a closed conformation, narrowing a hydrophobic channel to the catalytic site. A modelling study shows that the hydrophobic channel is optimal in both width and length for the binding of crotonyl-CoA. These results provide molecular bases for the high substrate specificity and the catalytic mechanism of TERs.