The CRISPR immune system in prokaryotes utilizes small guide RNAs to neutralize invading viruses and plasmids. In Escherichia coli, immunity is dependent on a ribonucleoprotein complex called Cascade. Here we present the composition and low-resolution structure of Cascade and show how it recognizes double-stranded DNA targets in a sequence specific manner. Cascade is a 405 kDa complex comprising five functionally essential Cas proteins (CasABCDE) and a crRNA. The crRNA guides Cascade to dsDNA target sequences by basepairing with the complementary DNA strand while displacing the non-complementary strand to form an R-loop. Target DNA recognition by Cascade takes place without ATP consumption, suggesting that continuous invader DNA surveillance takes place without energy investments. The structure of Cascade reveals an unusual seahorse-shape that undergoes conformational changes upon target DNA binding. A structural model of Cascade is presented that provides insight into the architecture of Cas protein complexes