Arsenic (As) biomethylation is an important component of the As biogeochemical cycle, which produces methylarsenite [MAs(III)] as an intermediate product. Its high toxicity is used by some microbes as an antibiotic to kill off other microbes and gain a competitive advantage. Some aerobic microbes have evolved a detoxification mechanism to demethylate MAs(III) via the dioxygenase C−As lyase ArsI. How MAs(III) is demethylated under anoxic conditions is unclear. We found that nitrate addition to a flooded paddy soil enhanced MAs(III) demethylation. A facultative anaerobe Bacillus sp. CZDM1 isolated from the soil was able to demethylate MAs(III) under anoxic nitratereducing conditions. A putative C−As lyase gene (BcarsI) was identified in the genome of strain CZDM1. The expression of BcarsI in the As-sensitive Escherichia coli AW3110 conferred the bacterium the ability to demethylate MAs(III) under anoxic nitrate-reducing condition and enhanced its resistance to MAs(III). Both Bacillus sp. CZDM1 and E. coli AW3110 harboring BcarsI could not demethylate MAs(III) under fermentative conditions. Five conserved amino acid resides of cysteine, histidine, and glutamic acid are essential for MAs(III) demethylation under anoxic nitrate-reducing conditions. Putative arsI genes are widely present in denitrifying bacteria, with 75% of the sequenced genomes containing arsI, also possessing dissimilatory nitrate reductase genes narG or napA. These results reveal a novel mechanism in which MAs(III) is demethylated via ArsI by coupling to denitrification, and such a mechanism is likely to be common in an anoxic environment such as paddy soils and wetlands.