The ATP grasp superfamily of enzymes shares an atypical nucleotide binding site known as the ATP grasp fold. These enzymes are involved in a diverse range of biological pathways and are found across all domains of life. One such example, D-alanine-D-alanine ligase (Ddl), is essential for bacterial cell wall biosynthesis, catalysing the ATP-dependent formation of the D-alanyl-D-alanine dipeptide, and is an important antibiotic drug target. Ddl is known to be activated by the monovalent cation potassium, but despite its clinical relevance and decades of research, how this occurs has not been elucidated. Here we present crystal structures of Thermus thermophilus Ddl representing distinct stages of catalysis in complex with potassium, rubidium or caesium. From these structures we have proposed a mechanism for the activation of Ddl. Comparison with Ddl reveals that the identified monovalent cation binding site is structurally conserved within members of the ATP grasp superfamily. Together, this provides new insight into the catalytic mechanism of Ddl and other ATP grasp enzymes.