A major goal of structural genomics is the provision of a structural template for a large fraction of protein domains. The magnitude of this task depends on the number and nature of protein sequence families. With a large number of bacterial genomes now fully sequenced, it is possible to obtain improved estimates of the number and diversity of families in that kingdom. We have used an automated clustering procedure to group all sequences in a set of genomes into protein families. Bench-marking shows the clustering method is sensitive at detecting remote family members, and has a low level of false positives. This comprehensive protein family set has been used to address the following questions. (1) What is the structure coverage for currently known families? (2) How will the number of known apparent families grow as more genomes are sequenced? (3) What is a practical strategy for maximizing structure coverage in future? Our study indicates that approximately 20% of known families with three or more members currently have a representative structure. The study indicates also that the number of apparent protein families will be considerably larger than previously thought: We estimate that, by the criteria of this work, there will be about 250,000 protein families when 1000 microbial genomes have been sequenced. However, the vast majority of these families will be small, and it will be possible to obtain structural templates for 70-80% of protein domains with an achievable number of representative structures, by systematically sampling the larger families.