Diversity-generating retroelements (DGRs) are widely distributed in bacteria, archaea, and microbial viruses, and bring about unparalleled levels of sequence variation in target proteins. While DGR variable proteins share low sequence identity, the structures of several such proteins have revealed the C-type lectin (CLec)-fold as a conserved scaffold for accommodating massive sequence variation. This conservation has led to the suggestion that the CLec-fold may be useful in molecular surface display applications. Thermostability is an attractive feature in such applications, and thus we studied the variable protein of a DGR encoded by a prophage of the thermophile Thermus aquaticus. We report here the 2.8 Å resolution crystal structure of the variable protein from the T. aquaticus DGR, called TaqVP, and confirm that it has a CLec-fold. Remarkably, its variable region is nearly identical in structure to those of several other CLec-fold DGR variable proteins despite low sequence identity among these. TaqVP was found to be thermostable, which appears to be a property shared by several CLec-fold DGR variable proteins. These results provide impetus for the pursuit of the DGR variable protein CLec-fold in molecular display applications.