Decapping is a key step in both general and nonsense-mediated 5' --> 3' mRNA-decay pathways. Removal of the cap structure is catalyzed by the Dcp1-Dcp2 complex. The crystal structure of a C-terminally truncated Schizosaccharomyces pombe Dcp2p reveals two distinct domains: an all-helical N-terminal domain and a C-terminal domain that is a classic Nudix fold. The C-terminal domain of both Saccharomyces cerevisiae and S. pombe Dcp2p proteins is sufficient for decapping activity, although the N-terminal domain can affect the efficiency of Dcp2p function. The binding of Dcp2p to Dcp1p is mediated by a conserved surface on its N-terminal domain, and the N-terminal domain is required for Dcp1p to stimulate Dcp2p activity. The flexible nature of the N-terminal domain relative to the C-terminal domain suggests that Dcp1p binding to Dcp2p may regulate Dcp2p activity through conformational changes of the two domains.