ChiZ is a transmembrane protein from Mycobacterium tuberculosis involved in the control of cell division. While the exact action of this protein is unknown, ChiZ can indirectly interfere with FtsZ ring formation. Interestingly, the N-terminal cytoplasmic region is able to hydrolyze peptidoglycan (PG) in vitro, even though it is intrinsically disordered. Based on sequence alignment of N-terminus, it is possible to identify a conserved 26 amino acid stretch required for PG hydrolysis and located just before the single transmembrane helix. Although the first 38 residues of the N-terminus are not conserved, a highly positively charged sequence is essential for activity. Using solution NMR tools to characterize the N-terminal region, it is possible to show that the conserved region has different dynamics, proton exchange rates, and tendency to form transient secondary structure compared to the non-conserved region. To assess the relevance of these differences, the N-terminal region was studied in the presence of liposomes and pure PG. The N-terminal region is able to bind liposomes but it is mostly detectable with INEPT based solid state NMR experiments, indicating that this region remains highly dynamic, even in the reconstituted full length protein. Paramagnetic relaxation enhancement experiments showed that the interaction of N-terminal region with lipids is mediated by electrostatic interactions between arginine side chains and lipid head groups. Other residues affected by the paramagnetic ion were located mainly in the middle region. Interestingly, N-terminal binding to PG is similar to binding lipids and it is mediated by arginine and proline rich regions. This data suggests that the loose binding of the N-terminal region to lipids may facilitate the sampling of conformations that can recognize substrate for catalysis. Speculation as to this function in the cytoplasmic domain will be presented.