The protein phosphatase calcineurin is the putative target for the immunosuppressive drug FK-506. The enzyme is inhibited by the complex of the drug with its intracellular receptor, the 12-kDa FK-506-binding protein (FKBP12), and the strength of inhibition usually correlates strongly with immunosuppressive potency. We find, however, that the complex of yeast FKBP12 with L-685,818, a well characterized antagonist of FK-506 immunosuppression, is a potent inhibitor of calcineurin. The corresponding human complex does not inhibit the enzyme, and both human and yeast complexes with FK-506 do inhibit. To understand the structural basis of these findings, we have determined the three-dimensional structure of the complex of yeast FKBP12 with FK-506 by x-ray crystallography, and have found that the structure of the yeast complex is strikingly similar to its human homolog. These observations indicate that specific sequence elements in the yeast protein provide stronger binding interactions with a heterologous calcineurin than do the corresponding elements in the human protein, and suggest structural modifications that may improve the potency of this class of immunosuppressants.