Nonheme iron(II)-hydroperoxo species (FeII-(η2-OOH)) 1 and the concomitant oxo-iron(IV)-hydroxyl one 2 are proposed as the key intermediates of a large class of 2-oxoglutarate dependent dioxygenases (e.g., isopenicillin N synthase). Extensive biomimetic experiments have been exerted to identify which one is the real oxidant and to reveal the structure-function relationship of them, whereas the mechanistic picture is still elusive. To this end, density functional theory (DFT) calculations were performed to systematically study the mechanistic details of ligand self-hydroxylation and competitive substrate oxidation by these two species supported by a tridentate ligand Fe(TpPh2)(benzilate) (TpPh2 = hydrotris(3,5-diphenylpyrazole-1-yl)borate). The calculated results revealed that the structure and the conversion of the FeII-(η2-OOH) complex 1 are obviously different from the ferric FeIII-OOH one. The orientation of the Fe-OOH moiety of 1 is side-on, while that of the ferric FeIII-OOH species is end-on. The conversion of 1 to the high-valent iron-oxo species is exothermic, while the conversion of the ferric FeIII-OOH species to the high-valent species is endothermic. Thus, the sluggish 1 does not act as the oxidant and readily decays to the robust 2. The activation energy of intramolecular ligand self-hydroxylation in 2 is 14.8 kcal mol-1 and intermolecular substrate oxidations (e.g., thioanisole sulfoxidation) with a lower barrier show a strong inhibiting ability toward ligand self-hydroxylation, while those with a higher barrier (e.g., cyclohexane hydroxylation) have no effect. Our theoretical results fit nicely with the experimental observations and will enrich the knowledge of the metal-oxygen intermediate and play a positive role in the rational design of new biomimetic catalysts.