High-resolution crystal structures are reported for apo, holo, and substrate-bound forms of a toxoflavin-degrading metalloenzyme (TflA). In addition, the degradation reaction is shown to be dependent on oxygen, Mn(II), and dithiothreitol in vitro. Despite its low sequence identity with proteins of known structure, TflA is structurally homologous to proteins of the vicinal oxygen chelate superfamily. Like other metalloenzymes in this superfamily, the TflA fold contains four modules that associate to form a metal binding site; however, the fold displays a rare rearrangement of the structural modules indicative of domain permutation. Moreover, unlike the 2-His-1-carboxylate facial triad commonly utilized by vicinal oxygen chelate dioxygenases and other dioxygen-activating non-heme Fe(II) enzymes, the metal center in TflA consists of a 1-His-2-carboxylate facial triad. The substrate-bound complex shows square-pyramidal geometry in which one position is occupied by O5 of toxoflavin. The open coordination site is predicted to be the dioxygen binding site. TflA appears to stabilize the reduced form of toxoflavin through second-sphere interactions. This anionic species is predicted to be the electron source responsible for reductive activation of oxygen to produce a peroxytoxoflavin intermediate.