The C2 domain is a Ca(2+)-binding motif of approximately 130 residues in length originally identified in the Ca(2+)-dependent isoforms of protein kinase C. Single and multiple copies of C2 domains have been identified in a growing number of eukaryotic signalling proteins that interact with cellular membranes and mediate a broad array of critical intracellular processes, including membrane trafficking, the generation of lipid-second messengers, activation of GTPases, and the control of protein phosphorylation. As a group, C2 domains display the remarkable property of binding a variety of different ligands and substrates, including Ca2+, phospholipids, inositol polyphosphates, and intracellular proteins. Expanding this functional diversity is the fact that not all proteins containing C2 domains are regulated by Ca2+, suggesting that some C2 domains may play a purely structural role or may have lost the ability to bind Ca2+. The present review summarizes the information currently available regarding the structure and function of the C2 domain and provides a novel sequence alignment of 65 C2 domain primary structures. This alignment predicts that C2 domains form two distinct topological folds, illustrated by the recent crystal structures of C2 domains from synaptotagmin 1 and phosphoinositide-specific phospholipase C-delta 1, respectively. The alignment highlights residues that may be critical to the C2 domain fold or required for Ca2+ binding and regulation.