A eukaryote-type actin and its binding protein profilin encoded on a genomic island in the cyanobacterium Microcystis aeruginosa PCC 7806 co-localize to form a hollow, spherical enclosure occupying a considerable intracellular space as shown by in vivo fluorescence microscopy. Biochemical and biophysical characterization reveals key differences between these proteins and their eukaryotic homologs. Small-angle X-ray scattering shows that the actin assembles into elongated, filamentous polymers which can be visualized microscopically with fluorescent phalloidin. Whereas rabbit actin forms thin cylindrical filaments about 100 µm in length, cyanobacterial actin polymers resemble a ribbon, arrest polymerization at 5-10 µm and tend to form irregular multi-strand assemblies. While eukaryotic profilin is a specific actin monomer binding protein, cyanobacterial profilin shows the unprecedented property of decorating actin filaments. Electron micrographs show that cyanobacterial profilin stimulates actin filament bundling and stabilizes their lateral alignment into heteropolymeric sheets from which the observed hollow enclosure may be formed. We hypothesize that adaptation to the confined space of a bacterial cell devoid of binding proteins usually regulating actin polymerization in eukaryotes has driven the co-evolution of cyanobacterial actin and profilin, giving rise to an intracellular entity.