The phosphoesterase (PE) domain of the bacterial DNA repair enzyme LigD possesses distinctive manganese-dependent 3′-phosphomonoesterase and 3′-phosphodiesterase activities. PE exemplifies a new family of DNA end-healing enzymes found in all phylogenetic domains. Here, we determined the structure of the PE domain of Pseudomonas aeruginosa LigD (PaePE) using solution NMR methodology. PaePE has a disordered N-terminus and a well-folded core that differs in instructive ways from the crystal structure of a PaePE•Mn2+• sulfate complex, especially at the active site that is found to be conformationally dynamic. Chemical shift perturbations in the presence of primer-template duplexes with 3′-deoxynucleotide, 3′-deoxynucleotide 3′-phosphate, or 3′ ribonucleotide termini reveal the surface used by PaePE to bind substrate DNA and suggest a more efficient engagement in the presence of a 3′-ribonucleotide. Spectral perturbations measured in the presence of weakly catalytic (Cd2+) and inhibitory (Zn2+) metals provide evidence for significant conformational changes at and near the active site, compared to the relatively modest changes elicited by Mn2+.