Depolymerization of polysaccharides is catalyzed by highly specific enzymes that promote hydrolysis of the scissile glycosidic bond by an activated water molecule. 1,3-1,4-beta-Glucanases selectively cleave beta-1,4 glycosidic bonds in 3-O-substituted glucopyranosyl units within polysaccharides with mixed linkage. The reaction follows a double-displacement mechanism by which the configuration of the anomeric C(1)-atom of the glucosyl unit in subsite -I is retained. Here we report the high-resolution crystal structure of the hybrid 1,3-1,4-beta-glucanase H(A16-M)(E105Q/E109Q) in complex with a beta-glucan tetrasaccharide. The structure shows four beta-d-glucosyl moieties bound to the substrate-binding cleft covering subsites -IV to -I, thus corresponding to the reaction product. The ten active-site residues Asn26, Glu63, Arg65, Phe92, Tyr94, Glu105, Asp107, Glu109, Asn182 and Trp184 form a network of hydrogen bonds and hydrophobic stacking interactions with the substrate. These residues were previously identified by mutational analysis as significant for stabilization of the enzyme-carbohydrate complex, with Glu105 and Glu109 being the catalytic residues. Compared to the Michaelis complex model, the tetrasaccharide moiety is slightly shifted toward that part of the cleft binding the non-reducing end of the substrate, but shows previously unanticipated strong stacking interactions with Phe92 in subsite -I. A number of specific hydrogen-bond contacts between the enzyme and the equatorial O(2), O(3) and O(6) hydroxyl groups of the glucosyl residues in subsites -I, -II and -III are the structural basis for the observed substrate specificity of 1,3-1,4-beta-glucanases. Kinetic analysis of enzyme variants with the all beta-1,3 linked polysaccharide laminarin identified key residues mediating substrate specificity in good agreement with the structural data. The comparison with structures of the apo-enzyme H(A16-M) and a covalent enzyme-inhibitor (E.I) complex, together with kinetic and mutagenesis data, yields new insights into the structural requirements for substrate binding and catalysis. A detailed view of enzyme-carbohydrate interactions is presented and mechanistic implications are discussed.