RNase E is an essential endoribonuclease involved in RNA processing and mRNA degradation. The N-terminal half of the protein encompasses the catalytic domain; the C-terminal half is the scaffold for the assembly of the multienzyme RNA degradosome. Here we identify and characterize 'segment-A', an element in the beginning of the non-catalytic region of RNase E that is required for membrane binding. We demonstrate in vitro that an oligopeptide corresponding to segment-A has the propensity to form an amphipathic alpha-helix and that it avidly binds to protein-free phospholipid vesicles. We demonstrate in vitro and in vivo that disruption of segment-A in full-length RNase E abolishes membrane binding. Taken together, our results show that segment-A is necessary and sufficient for RNase E binding to membranes. Strains in which segment-A has been disrupted grow slowly. Since in vitro experiments show that phospholipid binding does not affect the ribonuclease activity of RNase E, the slow-growth phenotype might arise from a defect involving processes such as accessibility to substrates or interactions with other membrane-bound machinery. This is the first report demonstrating that RNase E is a membrane-binding protein and that its localization to the inner cytoplasmic membrane is important for normal cell growth.