Penicillin binding proteins (PBPs) are membrane-associated proteins that catalyze the final step of murein biosynthesis. These proteins function as either transpeptidases or carboxypeptidases and in a few cases demonstrate transglycosylase activity. Both transpeptidase and carboxypeptidase activities of PBPs occur at the D-Ala-D-Ala terminus of a murein precursor containing a disaccharide pentapeptide comprising N-acetylglucosamine and N-acetyl-muramic acid-L-Ala-D-Glu-L-Lys-D-Ala-D-Ala. Beta-lactam antibiotics inhibit these enzymes by competing with the pentapeptide precursor for binding to the active site of the enzyme. Here we describe the crystal structure, biochemical characteristics, and expression profile of PBP4, a low-molecular-mass PBP from Staphylococcus aureus strain COL. The crystal structures of PBP4-antibiotic complexes reported here were determined by molecular replacement, using the atomic coordinates deposited by the New York Structural Genomics Consortium. While the pbp4 gene is not essential for the viability of S. aureus, the knockout phenotype of this gene is characterized by a marked reduction in cross-linked muropeptide and increased vancomycin resistance. Unlike other PBPs, we note that expression of PBP4 was not substantially altered under different experimental conditions, nor did it change across representative hospital- or community-associated strains of S. aureus that were examined. In vitro data on purified recombinant S. aureus PBP4 suggest that it is a beta-lactamase and is not trapped as an acyl intermediate with beta-lactam antibiotics. Put together, the expression analysis and biochemical features of PBP4 provide a framework for understanding the function of this protein in S. aureus and its role in antimicrobial resistance.