Seventh pandemic Vibrio cholerae strains contain two pathogenicity islands that encode the DNA defense modules DdmABC and DdmDE. Here we use cryogenic electron microscopy to reveal the mechanistic basis for plasmid defense by DdmDE. A structure of the DdmD helicase-nuclease reveals it adopts an auto-inhibited dimeric architecture. The prokaryotic Argonaute protein DdmE uses a DNA guide to target plasmid DNA. A structure of the DdmDE complex, validated by in vivo mutational studies, shows that DNA binding by DdmE triggers disassembly of the DdmD dimer and loading of monomeric DdmD onto the non-target DNA strand. In vitro studies reveal that DdmD translocates in the 5′-to-3′ direction, while partially degrading the plasmid DNA. These findings provide critical insights into the mechanism of DdmDE systems in plasmid elimination.