Fatty acid (FA) transfer proteins extract FA from membranes and sequester them to facilitate their movement through the cytosol. Detailed structural information is available for these soluble protein-FA complexes, but the structure of the protein conformation responsible for FA exchange at the membrane is unknown. Staphylococcus aureus FakB1 is a prototypical bacterial FA transfer protein that binds palmitate within a narrow, buried tunnel. Here, we define the conformational change from a "closed" FakB1 state to an "open" state that associates with the membrane and provides a path for entry and egress of the FA. Using NMR spectroscopy, we identified a conformationally flexible dynamic region in FakB1, and X-ray crystallography of FakB1 mutants captured the conformation of the open state. In addition, molecular dynamics simulations show that the new amphipathic α-helix formed in the open state inserts below the phosphate plane of the bilayer to create a diffusion channel for the hydrophobic FA tail to access the hydrocarbon core and place the carboxyl group at the phosphate layer. The membrane binding and catalytic properties of site-directed mutants were consistent with the proposed membrane docked structure predicted by our molecular dynamics simulations. Finally, the structure of the bilayer-associated conformation of FakB1 has local similarities with mammalian FA binding proteins and provides a conceptual framework for how these proteins interact with the membrane to create a diffusion channel from the FA location in the bilayer to the protein interior. [ABSTRACT FROM AUTHOR]