The bifunctional enzyme UDP-GlcNAc 2-epimerase/ManNAc kinase (GNE) plays a key role in sialic acid production. It is different from the non-hydrolyzing enzymes for bacterial cell wall biosynthesis, and it is feed-back inhibited by the downstream product CMP-Neu5Ac. Here the complex crystal structure of the N-terminal epimerase part of human GNE shows a tetramer in which UDP binds to the active site and CMP-Neu5Ac binds to the dimer-dimer interface. The enzyme is locked in a tightly closed conformation. By comparing the UDP-binding modes of the non-hydrolyzing and hydrolyzing UDP-GlcNAc epimerases, we propose a possible explanation for the mechanistic difference. While the epimerization reactions of both enzymes are similar, Arg113 and Ser302 of GNE are likely involved in product hydrolysis. On the other hand, the CMP-Neu5Ac binding mode clearly elucidates why mutations in Arg263 and Arg266 can cause sialuria. Moreover, full-length modelling suggests a channel for ManNAc trafficking within the bifunctional enzyme.