Cyclotides are bioactive cyclic peptides isolated from plants that are characterized by a topologically complex structure and exceptional resistance to enzymatic or thermal degradation. With their sequence diversity, ultra-stable core structural motif, and range of bioactivities, cyclotides are regarded as a combinatorial peptide template with potential applications in drug design. The mode of action of cyclotides remains elusive, but all reported biological activities are consistent with a mechanism involving membrane interactions. In this study, a diverse set of cyclotides from the two major subfamilies, Möbius and bracelet, and an all-d mirror image form, were examined to determine their mode of action. Their lipid selectivity and membrane affinity were determined, as were their toxicities against a range of targets (red blood cells, bacteria, and HIV particles). Although they had different membrane-binding affinities, all of the tested cyclotides targeted membranes through binding to phospholipids containing phosphatidylethanolamine headgroups. Furthermore, the biological potency of the tested cyclotides broadly correlated with their ability to target and disrupt cell membranes. The finding that a broad range of cyclotides target a specific lipid suggests their categorization as a new lipid-binding protein family. Knowledge of their membrane specificity has the potential to assist in the design of novel drugs based on the cyclotide framework, perhaps allowing the targeting of peptide drugs to specific cell types.