Dye-decolorizing peroxidases (DyPs) belong to the large group of heme peroxidases. They utilize hydrogen peroxide to catalyze oxidations of various organic compounds. AauDyPI from Auricularia auricula-judae (fungi) was crystallized, and its crystal structure was determined at 2.1 Å resolution. The mostly helical structure also shows a β-sheet motif typical for DyPs and Cld (chlorite dismutase)-related structures and includes the complete polypeptide chain. At the distal side of the heme molecule, a flexible aspartate residue (Asp-168) plays a key role in catalysis. It guides incoming hydrogen peroxide toward the heme iron and mediates proton rearrangement in the process of Compound I formation. Afterward, its side chain changes its conformation, now pointing toward the protein backbone. We propose an extended functionality of Asp-168, which acts like a gatekeeper by altering the width of the heme cavity access channel. Chemical modifications of potentially redox-active amino acids show that a tyrosine is involved in substrate interaction. Using spin-trapping experiments, a transient radical on the surface-exposed Tyr-337 was identified as the oxidation site for bulky substrates. A possible long-range electron transfer pathway from the surface of the enzyme to the redox cofactor (heme) is discussed.