Bacteriophage T4 RNase H, a flap endonuclease-1 family nuclease, removes RNA primers from lagging strand fragments. It has both 5 nuclease and flap endonuclease activities. Our previous structure of native T4 RNase H (PDB 1TFR) revealed an active site composed of highly conserved Asp residues and two bound hydrated magnesium ions. Here, we report the crystal structure of T4 RNase H in complex with a fork DNA substrate bound in its active site. This is the first structure of a FEN-1 family protein with its complete branched substrate. The fork duplex interacts with an extended loop of the HhH2 motif. The 5 arm crosses over the active site, extending below the bridge (helical arch) region. Cleavage assays of this DNA substrate identify a primary cut site 7-bases in from the 5 arm. The scissile phosphate, the first bond in the duplex DNA adjacent to the 5 arm, lies above a magnesium binding site. The less ordered 3 arm reaches towards the C- and N- termini of the enzyme, which are binding sites for T4 32 protein and T4 45 clamp, respectively. In the crystal structure, the scissile bond is located within the double-stranded DNA, between the first two duplex nucleotides next to the 5 arm, and lies above a magnesium binding site. This complex provides important insight into substrate recognition and specificity of the FEN-1 enzymes.