The COVID-19 pandemic, caused by the SARS-CoV-2 virus, has created global health and economic emergencies. SARS-CoV-2 viruses promote their own spread and virulence by hijacking human proteins, which occurs through viral protein recognition of human targets. To understand the structural basis for SARS-CoV-2 viral-host protein recognition, here we use cryo-electron microscopy (cryo-EM) to determine a complex structure of the human cell junction protein PALS1 and SARS-CoV-2 viral envelope (E) protein. Our reported structure shows that the E protein C-terminal DLLV motif recognizes a pocket formed exclusively by hydrophobic residues from the PDZ and SH3 domains of PALS1. Our structural analysis provides an explanation for the observation that the viral E protein recruits PALS1 from lung epithelial cell junctions. In addition, our structure provides novel targets for peptide- and small-molecule inhibitors that could block the PALS1-E interactions to reduce E-mediated virulence.