Type 4 P-type ATPases (P4-ATPases) are lipid flippases that drive the active transport of phospholipids from exoplasmic or luminal leaflets to cytosolic leaflets of eukaryotic membranes. The molecular architecture of P4-ATPases and the mechanism through which they recognize and transport lipids have remained unknown. Here we describe the cryo-electron microscopy structure of the P4-ATPase Drs2p–Cdc50p, a Saccharomyces cerevisiae lipid flippase that is specific to phosphatidylserine and phosphatidylethanolamine. Drs2p–Cdc50p is autoinhibited by the C-terminal tail of Drs2p, and activated by the lipid phosphatidylinositol-4-phosphate (PtdIns4P or PI4P). We present three structures that represent the complex in an autoinhibited, an intermediate and a fully activated state. The analysis highlights specific features of P4-ATPases and reveals sites of autoinhibition and PI4P-dependent activation. We also observe a putative lipid translocation pathway in this flippase that involves a conserved PISL motif in transmembrane segment 4 and polar residues of transmembrane segments 2 and 5, in particular Lys1018, in the centre of the lipid bilayer.