MCoTI-II is a head-to-tail cyclic peptide with potent trypsin inhibitory activity and, on the basis of its exceptional proteolytic stability, is a valuable template for the design of novel drug leads. Insights into inhibitor dynamics and interactions with biological targets are critical for drug design studies, particularly for protease targets. Here, we show that the cyclization and active site loops of MCoTI-II are flexible in solution, but when bound to trypsin, the active site loop converges to a single well defined conformation. This finding of reduced flexibility on binding is in contrast to a recent study on the homologous peptide MCoTI-I, which suggested that regions of the peptide are more flexible upon binding to trypsin. We provide a possible explanation for this discrepancy based on degradation of the complex over time. Our study also unexpectedly shows that the cyclization loop, not present in acyclic homologues, facilitates potent trypsin inhibitory activity by engaging in direct binding interactions with trypsin.