This study uses density functional theory (DFT) calculations to explore the reactivity of the putative high-valent iron-oxo reagent of the iron-substituted polyoxometalate (POM-FeO4-), derived from the Keggin species, PW12O40(3-). It is shown that POM-FeO4- is in principle capable of C-H hydroxylation and C=C epoxidation and that it should be a powerful oxidant, even more so than the Compound I species of cytochrome P450. The calculations indicate that in a solvent, the barriers, and especially those for epoxidation, become sufficiently small that one may expect an extremely fast reaction. An experimental investigation (by R.N. and A.M.K.) shows, however, that the formation of POM-FeO4- using the oxygen donor, F5PhI-O, leads to a persistent adduct, POM-FeO-I-PhF5(4-), which does not decompose to POM-FeO4- + F5Ph-I at the working temperature and exhibits sluggish reactivity, in accord with previous experimental results (Hill, C. L.; Brown, R. B., Jr. J. Am. Chem. Soc. 1986, 108, 536 and Mansuy, D.; Bartoli, J.-F.; Battioni, P.; Lyon, D. K.; Finke, R. G. J. Am. Chem. Soc. 1991, 113, 7222). Subsequent calculations indeed reveal that the gas-phase binding energy of F5PhI to POM-FeO4- is high (ca. 20 kcal/mol) compared to the corresponding binding energy of propene (ca. 2-3 kcal/mol). As such, the POM-FeO-I-PhF5(4-) complex is expected to be persistent toward the displacement of F5PhI by a substrate like propene, leading thereby to sluggish oxidative reactivity. According to theory, overcoming this technical difficulty may turn out to be very rewarding. The question is, can POM-FeO4- be made?