The 2.5-A resolution crystal structure of recombinant aristolochene synthase from the blue cheese mold, Penicillium roqueforti, is the first of a fungal terpenoid cyclase. The structure of the enzyme reveals active site features that participate in the cyclization of the universal sesquiterpene cyclase substrate, farnesyl diphosphate, to form the bicyclic hydrocarbon aristolochene. Metal-triggered carbocation formation initiates the cyclization cascade, which proceeds through multiple complex intermediates to yield one exclusive structural and stereochemical isomer of aristolochene. Structural homology of this fungal cyclase with plant and bacterial terpenoid cyclases, despite minimal amino acid sequence identity, suggests divergence from a common, primordial ancestor in the evolution of terpene biosynthesis.