The cyclic decapeptides polymyxin B (PmB) and E (PmE) (mo-K'TK'-cyclo-[K'K'XLK'K'T]; mo, methyl octanoate; K', diaminobutyric acid; X, D-Phe (PmB) or D-Leu (PmE)) display antimicrobial and lipopolysaccharide (LPS) antagonistic activities. We have investigated the conformational behavior of PmB and PmE in water solution, free and bound to LPS, by homonuclear NMR and molecular modeling methods. The free peptides exist in equilibria of fast exchanging conformations with local preferences for a distorted type II' beta-turn from residues 5-8, and/or a gamma-turn in residue 10. These two motifs are not present in the bound conformation of the peptides. The latter is amphiphilic separating the two hydrophobic residues in the cycle from the positively charged diaminobutyric acid side chains by an envelope-like fold of the cycle. The bound conformation is used for the derivation of a model of the PmB-lipid A complex based on electrostatic interactions and reduction of hydrophobic area. The proposed mode of binding breaks up the supramolecular structure of LPS connected with its toxicity. The model should contribute to the understanding of entropy-driven PmB-lipid A binding at the molecular level and assist the design of inhibitors of endotoxic activity.