Effective and safe therapies for the treatment of diseases caused by intraerythrocytic parasites are impeded by the rapid emergence of drug resistance and the lack of novel drug targets. One such disease is human babesiosis, which is a rapidly emerging tick-borne illness caused by Babesia parasites. In this study, we identified fosinopril, a phosphonate-containing, FDA-approved Angiotensin Converting Enzyme (ACE) inhibitor commonly used as a prodrug for hypertension and heart failure, as a potent inhibitor of B. duncani parasite development within human erythrocytes. Cell biological and mass spectrometry analyses revealed that the conversion of fosinopril to its active diacid molecule, fosinoprilat, is essential for its antiparasitic activity. We show that this conversion is mediated by a parasite-encoded esterase, BdFE1, which is highly conserved among apicomplexan parasites. Parasites carrying the L238H mutation in the active site of BdFE1 failed to convert the prodrug to its active moiety and became resistant to the drug. Our data set the stage for the development of this class of drugs for therapy of vector-borne parasitic diseases.