A major challenge in the post-genome era will be determination of the functions of the encoded protein sequences. Since it is generally assumed that the function of a protein is closely linked to its three-dimensional structure, prediction or experimental determination of the library of protein structures is a matter of high priority. However, a large proportion of gene sequences appear to code not for folded, globular proteins, but for long stretches of amino acids that are likely to be either unfolded in solution or adopt non-globular structures of unknown conformation. Characterization of the conformational propensities and function of the non-globular protein sequences represents a major challenge. The high proportion of these sequences in the genomes of all organisms studied to date argues for important, as yet unknown functions, since there could be no other reason for their persistence throughout evolution. Clearly the assumption that a folded three-dimensional structure is necessary for function needs to be re-examined. Although the functions of many proteins are directly related to their three-dimensional structures, numerous proteins that lack intrinsic globular structure under physiological conditions have now been recognized. Such proteins are frequently involved in some of the most important regulatory functions in the cell, and the lack of intrinsic structure in many cases is relieved when the protein binds to its target molecule. The intrinsic lack of structure can confer functional advantages on a protein, including the ability to bind to several different targets. It also allows precise control over the thermodynamics of the binding process and provides a simple mechanism for inducibility by phosphorylation or through interaction with other components of the cellular machinery. Numerous examples of domains that are unstructured in solution but which become structured upon binding to the target have been noted in the areas of cell cycle control and both transcriptional and translational regulation, and unstructured domains are present in proteins that are targeted for rapid destruction. Since such proteins participate in critical cellular control mechanisms, it appears likely that their rapid turnover, aided by their unstructured nature in the unbound state, provides a level of control that allows rapid and accurate responses of the cell to changing environmental conditions. Copyright 1999 Academic Press.