Bacterial pathogens must acquire host iron for survival and colonization. Because free iron is restricted in the host, numerous pathogens have evolved to overcome this limitation by using a family of monooxygenases that mediate the oxidative cleavage of heme into biliverdin, carbon monoxide, and iron. However, the etiological agent of tuberculosis, Mycobacterium tuberculosis, accomplishes this task without generating carbon monoxide, which potentially induces its latent state. Here we show that this unusual heme degradation reaction proceeds through sequential mono- and dioxygenation events within the single active center of MhuD, a mechanism unparalleled in enzyme catalysis. A key intermediate of the MhuD reaction is found to be meso-hydroxyheme, which reacts with O2 at an unusual position to completely suppress its monooxygenation but to allow ring cleavage through dioxygenation. This mechanistic change, possibly due to heavy steric deformation of hydroxyheme, rationally explains the unique heme catabolites of MhuD. Coexistence of mechanistically distinct functions is a previously unidentified strategy to expand the physiological outcome of enzymes, and may be applied to engineer unique biocatalysts.