Aberrant folding of proteins in the endoplasmic reticulum activates the bifunctional transmembrane kinase/endoribonuclease Ire1. Ire1 excises an intron from HAC1 messenger RNA in yeasts and Xbp1 messenger RNA in metozoans encoding homologous transcription factors. This non-conventional mRNA splicing event initiates the unfolded protein response, a transcriptional program that relieves the endoplasmic reticulum stress. Here we show that oligomerization is central to Ire1 function and is an intrinsic attribute of its cytosolic domains. We obtained the 3.2-A crystal structure of the oligomer of the Ire1 cytosolic domains in complex with a kinase inhibitor that acts as a potent activator of the Ire1 RNase. The structure reveals a rod-shaped assembly that has no known precedence among kinases. This assembly positions the kinase domain for trans-autophosphorylation, orders the RNase domain, and creates an interaction surface for binding of the mRNA substrate. Activation of Ire1 through oligomerization expands the mechanistic repertoire of kinase-based signalling receptors.