We report the crystal structure of the FAD/NADPH-binding domain (FAD domain) of the biotechnologically important Bacillus megaterium flavocytochrome P450 BM3, the last domain of the enzyme to be structurally resolved. The structure was solved in both the absence and presence of the ligand NADP +, identifying important protein interactions with the NADPH 2'-phosphate that helps to dictate specificity for NADPH over NADH, and involving residues Tyr974, Arg966, Lys972 and Ser965. The Trp1046 side chain shields the FAD isoalloxazine ring from NADPH, and motion of this residue is required to enable NADPH-dependent FAD reduction. Multiple binding interactions stabilize the FAD cofactor, including aromatic stacking with the adenine group from the side chains of Tyr860 and Trp854, and several interactions with FAD pyrophosphate oxygens, including bonding to tyrosines 828, 829 and 860. Mutagenesis of C773 and C999 to alanine was required for successful crystallization, with C773A predicted to disfavour intramolecular and intermolecular disulfide bonding. Multiangle laser light scattering analysis showed wild-type FAD domain to be near-exclusively dimeric, with dimer disruption achieved on treatment with the reducing agent dithiothreitol. By contrast, light scattering showed that the C773A/C999A FAD domain was monomeric. The C773A/C999A FAD domain structure confirms that Ala773 is surface exposed and in close proximity to Cys810, with this region of the enzyme's connecting domain (that links the FAD domain to the FMN-binding domain in P450 BM3) located at a crystal contact interface between FAD domains. The FAD domain crystal structure enables molecular modelling of its interactions with its cognate FMN (flavodoxin-like) domain within the BM3 reductase module.