AbstractNon-heme iron and α-ketoglutarate (αKG) oxygenases catalyze remarkably diverse reactions using a single ferrous ion cofactor. A major challenge in studying this versatile family of enzymes is to understand their structure–function relationship. AusE from Aspergillus nidulans and PrhA from Penicillium brasilianum are two highly homologous Fe(II)/αKG oxygenases in fungal meroterpenoid biosynthetic pathways that use preaustinoid A1 as a common substrate to catalyze divergent rearrangement reactions to form the spiro-lactone in austinol and cycloheptadiene moiety in paraherquonin, respectively. Herein, we report the comparative structural study of AusE and PrhA, which led to the identification of three key active site residues that control their reactivity. Structure-guided mutagenesis of these residues results in successful interconversion of AusE and PrhA functions as well as generation of the PrhA double and triple mutants with expanded catalytic repertoire. Manipulation of the multifunctional Fe(II)/αKG oxygenases thus provides an excellent platform for the future development of biocatalysts.