The gram-negative bacterium, Legionella pneumophila is known to manipulate the host cellular functions. L. pneumophila secretes bacterial proteins called Legionella effectors into the host cytosol that are necessary for these manipulations. The Legionella effector Lpg1137 was identified as a serine protease responsible for the degradation of syntaxin 17 (Stx17). However, how Lpg1137 specifically recognizes and degrades Stx17 remained unknown. Given that Stx17 is localized in the ER, mitochondria-associated membrane (MAM), and mitochondria, Lpg1137 likely distributes to these compartments to recognize Stx17. Here, we show that the C-terminal region of Lpg1137 binds to phosphatidic acid (PA), a MAM and mitochondria-enriched phospholipid, and that this binding is required for the correct intracellular distribution of Lpg1137. Two basic residues in the C-terminal region of Lpg1137 are required for PA binding and their mutation causes mislocalization of Lpg1137. This mutant also fails to degrade Stx17 while retaining protease activity. Taken together, our data reveal that Lpg1137 utilizes PA for its distribution to the membranous compartments in which Stx17 is localized.