Oxidative stress is frequently identified as a mechanism of toxicity of nanomaterials. However, rarely have the specific underlying molecular targets responsible for these impacts been identified. We previously demonstrated significant negative impacts of transition metal oxide (TMO) lithium-ion battery cathode nanomaterial, lithium cobalt oxide (LCO), on the growth, development, hemoglobin, and heme synthesis gene expression in the larvae of a model sediment invertebrate Chironomus riparius. Here, we propose that alteration of the Fe−S protein function by LCO is a molecular initiating event leading to these changes. A 10 mg/L LCO exposure causes significant oxidation of the aconitase 4Fe−4S center after 7 d as determined from the electron paramagnetic resonance spectroscopy measurements of intact larvae and a significant reduction in the aconitase activity of larval protein after 48 h (p < 0.05). Next-generation RNA sequencing identified significant changes in the expression of genes involved in 4Fe−4S center binding, Fe−S center synthesis, iron ion binding, and metabolism for 10 mg/L LCO at 48 h (FDR-adjusted, p < 0.1). We propose an adverse outcome pathway, where the oxidation of metabolic and regulatory Fe−S centers of proteins by LCO disrupts metabolic homeostasis, which negatively impacts the growth and development, a mechanism that may apply for these conserved proteins across species and for other TMO nanomaterials.