Fascin is the main actin filament bundling protein in filopodia. Because of the important role filopodia play in cell migration, fascin is emerging as a major target for cancer drug discovery. However, an understanding of the mechanism of bundle formation by fascin is critically lacking. Fascin consists of four β-trefoil domains. Here, we show that fascin contains two major actin-binding sites, coinciding with regions of high sequence conservation in β-trefoil domains 1 and 3. The site in β-trefoil-1 is located near the binding site of the fascin inhibitor macroketone and comprises residue Ser-39, whose phosphorylation by protein kinase C down-regulates actin bundling and formation of filopodia. The site in β-trefoil-3 is related by pseudo-2-fold symmetry to that in β-trefoil-1. The two sites are ∼5 nm apart, resulting in a distance between actin filaments in the bundle of ∼8.1 nm. Residue mutations in both sites disrupt bundle formation in vitro as assessed by co-sedimentation with actin and electron microscopy and severely impair formation of filopodia in cells as determined by rescue experiments in fascin-depleted cells. Mutations of other areas of the fascin surface also affect actin bundling and formation of filopodia albeit to a lesser extent, suggesting that, in addition to the two major actin-binding sites, fascin makes secondary contacts with other filaments in the bundle. In a high resolution crystal structure of fascin, molecules of glycerol and polyethylene glycol are bound in pockets located within the two major actin-binding sites. These molecules could guide the rational design of new anticancer fascin inhibitors.