Actin capping and cross-linking proteins regulate the dynamics and architectures of different cellular protrusions. Eps8 is the founding member of a unique family of capping proteins capable of side-binding and bundling actin filaments. However, the structural basis through which Eps8 exerts these functions remains elusive. Here, we combined biochemical, molecular, and genetic approaches with electron microscopy and image analysis to dissect the molecular mechanism responsible for the distinct activities of Eps8. We propose that bundling activity of Eps8 is mainly mediated by a compact four helix bundle, which is contacting three actin subunits along the filament. The capping activity is mainly mediated by a amphipathic helix that binds within the hydrophobic pocket at the barbed ends of actin blocking further addition of actin monomers. Single-point mutagenesis validated these modes of binding, permitting us to dissect Eps8 capping from bundling activity in vitro. We further showed that the capping and bundling activities of Eps8 can be fully dissected in vivo, demonstrating the physiological relevance of the identified Eps8 structural/functional modules. Eps8 controls actin-based motility through its capping activity, while, as a bundler, is essential for proper intestinal morphogenesis of developing Caenorhabditis elegans. Copyright: ß 2010 Hertzog et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Funding: This study was supported by IFOM -The FIRC Institute of Molecular Oncology Foundation, and grants from CARIPLO, AIRC (Associazione Italiana Ricerca sul Cancro, #4874 and #4497), European Community (VI Framework), and PRIN2007 (progetti di ricerca di interesse nazionale) to GS, PPDF, (NIGMS) to DH and NV. The docking analysis was supported by NIH grant GM076503 to NV. The funders had no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript. Competing Interests: The authors have declared that no competing interests exist. Abbreviations: 3D, three-dimensional; ADF, Actin Depolymerizing Factor; AEDANS, 5-(2((acetyl)amino)ethyl)amino-naphthalene-1-sulfonate; CP, Capping Protein; DBP, Vitamin D binding protein; EM, electron microscopy; IRSp53, Insulin Receptor Tyrosine Kinases Substrate of 53 KD; Ki, Constant of Inhibition; Phyre, Protein Homology/Analogy Recognition Engine; PIP2, phosphatidylinositol 4,5-bisphosphate; PPDM, N,N'-(1,4-Phenylene)dimaleimide; WH2, WASp Homology 2 * E-mail: niels@burnham.org (NV); dorit@burnham.org (DH); Giorgio.scita@ifom-ieo-campus.it (GS) ¤ Current address: Institut Curie, Centre de Recherche, Paris, France . These authors contributed equally to this work.