Expression of the agouti signaling protein (ASIP) during hair growth produces the red/yellow pigment pheomelanin. ASIP, and its neuropeptide homolog the agouti-related protein (AgRP) involved in energy balance, are novel, paracrine signaling molecules that act as inverse agonists at distinct subsets of melanocortin receptors. Ubiquitous ASIP expression in mice gives rise to a pleiotropic phenotype characterized by a uniform yellow coat color, obesity, overgrowth, and metabolic derangements similar to type II diabetes in humans. Here we report the synthesis and NMR structure of ASIP's active, cysteine-rich, C-terminal domain. ASIP adopts the inhibitor cystine knot fold and, along with AgRP, are the only known mammalian proteins in this structure class. Moreover, ASIP populates two distinct conformers resulting from a cis peptide bond at Pro102-Pro103 and a coexistence of cis/trans isomers of Ala104-Pro105. Pharmacologic studies of Pro-->Ala mutants demonstrate that the minor conformation with two cis peptide bonds is responsible for activity at all MCRs. The loop containing the heterogeneous Ala-Pro peptide bond is conserved in mammals, and suggests that ASIP is either trapped by evolution in this unusual configuration or possesses function outside of strict MCR antagonism.