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The structure of PFE, an aryl esterase from Pseudomonas fluorescens, has been solved to a resolution of 1.8 Å by X-ray diffraction and shows a characteristic α/β-hydrolase fold. In addition to catalyzing the hydrolysis of esters in vitro, PFE also shows low bromoperoxidase activity. PFE shows highest structural similarity, including the active-site environment, to a family of non-heme bacterial haloperoxidases, with an r.m.s. deviation in 271 Cα atoms between PFE and its five closest structural neighbors averaging 0.8 Å. PFE has far less similarity (r.m.s. deviation in 218 Cα atoms of 5.0 Å) to P. fluorescens carboxyl esterase. PFE favors activated esters with small acyl groups, such as phenyl acetate. The X-ray structure of PFE reveals a significantly occluded active site. In addition, several residues, including Trp28 and Met95, limit the size of the acyl-binding pocket, explaining its preference for small acyl groups.