Replication of severe acute respiratory syndrome (SARS) coronavirus (SARS-CoV) requires proteolytic processing of the replicase polyprotein by two viral cysteine proteases, a chymotrypsin-like protease (3CLpro) and a papain-like protease (PLpro). These proteases are important targets for development of antiviral drugs that would inhibit viral replication and reduce mortality associated with outbreaks of SARS-CoV. In this work, we describe the 1.85-Å crystal structure of the catalytic core of SARS-CoV PLpro and show that the overall architecture adopts a fold closely resembling that of known deubiquitinating enzymes. Key features, however, distinguish PLpro from characterized deubiquitinating enzymes, including an intact zinc-binding motif, an unobstructed catalytically competent active site, and the presence of an intriguing, ubiquitin-like N-terminal domain. To gain insight into the active-site recognition of the C-terminal tail of ubiquitin and the related LXGG motif, we propose a model of PLpro in complex with ubiquitin–aldehyde that reveals well defined sites within the catalytic cleft that help to account for strict substrate-recognition motifs.