The crystal structure of Arthromyces ramosus peroxidase (ARP) in complex with benzhydroxamic acid (BHA) as determined by X-ray analysis at 1.6 A shows unambiguously how BHA binds to ARP. BHA is located in the distal heme pocket. Its functional groups are held by three hydrogen bonds to His56N(epsilon), Arg52N(epsilon), and Pro(154)O, but are too far away to interact with the heme iron. The aromatic ring of BHA is positioned at the entrance of the channel to the heme pocket, approximately parallel to the heme group. Most water molecules at the active site of the native enzyme are replaced by BHA, leaving a ligand, probably a water molecule, at the sixth position of the heme. Results are compared with spectroscopic data.