Lymphocyte function-associated antigen 1 (LFA-1) plays important roles in immune cell adhesion, trafficking, and activation and is a therapeutic target for the treatment of multiple autoimmune diseases. Efalizumab is one of the most efficacious antibody drugs for treating psoriasis, a very common skin disease, through inhibition of the binding of LFA-1 to the ligand intercellular adhesion molecule 1 (ICAM-1). We report here the crystal structures of the Efalizumab Fab alone and in complex with the LFA-1 αLI domain, which reveal the molecular mechanism of inhibition of LFA-1 by Efalizumab. The Fab binds with an epitope on the inserted (I) domain that is distinct from the ligand-binding site. Efalizumab binding blocks the binding of LFA-1 to ICAM-1 via steric hindrance between its light chain and ICAM-1 domain 2 and thus inhibits the activities of LFA-1. These results have important implications for the development of improved antibodies and new therapeutic strategies for the treatment of autoimmune diseases.