Structural inspection of the bacterial meroterpenoid antibiotics belonging to the napyradiomycin family of chlorinated dihydroquinones suggests that the biosynthetic cyclization of their terpenoid subunits is initiated via a chloronium ion. The vanadium-dependent haloperoxidases that catalyze such reactions are distributed in fungi and marine algae and have yet to be characterized from bacteria. The cloning and sequence analysis of the 43-kb napyradiomycin biosynthetic cluster (nap) from Streptomyces aculeolatus NRRL 18422 and from the undescribed marine sediment-derived Streptomyces sp. CNQ-525 revealed 33 open reading frames, three of which putatively encode vanadium-dependent chloroperoxidases. Heterologous expression of the CNQ-525-based nap biosynthetic cluster in Streptomyces albus produced at least seven napyradiomycins, including the new analog 2-deschloro-2-hydroxy-A80915C. These data not only revealed the molecular basis behind the biosynthesis of these novel meroterpenoid natural products but also resulted in the first in vivo verification of vanadium-dependent haloperoxidases.