The complex life cycle of Mycobacterium tuberculosis requires diverse energy mobilization and utilization strategies facilitated by a battery of lipid metabolism enzymes. Among lipid metabolism enzymes, the Lip family of mycobacterial serine hydrolases is essential to lipid scavenging, metabolic cycles, and reactivation from dormancy. On the basis of the homologous rescue strategy for mycobacterial drug targets, we have characterized the three-dimensional structure of full length LipW from Mycobacterium marinum, the first structure of a catalytically active Lip family member. LipW contains a deep, expansive substrate-binding pocket with only a narrow, restrictive active site, suggesting tight substrate selectivity for short, unbranched esters. Structural alignment reinforced this strict substrate selectivity of LipW, as the binding pocket of LipW aligned most closely with the bacterial acyl esterase superfamily. Detailed kinetic analysis of two different LipW homologues confirmed this strict substrate selectivity, as each homologue selected for unbranched propionyl ester substrates, irrespective of the alcohol portion of the ester. Using comprehensive substitutional analysis across the binding pocket, the strict substrate selectivity of LipW for propionyl esters was assigned to a narrow funnel in the acyl-binding pocket capped by a key hydrophobic valine residue. The polar, negatively charged alcohol-binding pocket also contributed to substrate orientation and stabilization of rotameric states in the catalytic serine. Together, the structural, enzymatic, and substitutional analyses of LipW provide a connection between the structure and metabolic properties of a Lip family hydrolase that refines its biological function in active and dormant tuberculosis infection.