Methanofuran is the first in a series of coenzymes involved in the reduction of carbon dioxide to methane. All methanofuran structural variants contain a basic core structure of 4-[N-(γ-l-glutamyl-γ-l-glutamyl)-p-(β-aminoethyl)phenoxymethyl]-2-(aminomethyl)furan (APMF-(Glu)2) with different attached side chains depending on the source organism. Recently, we discovered the biosynthetic route for the production of 5-(aminomethyl)-3-furanmethanol-phosphate (F1-P), a precursor to the furan moiety of methanofuran. However, how the γ-linked glutamates are incorporated into methanofuran's structure remains unknown. Here, we report the identification of an ATP-grasp enzyme encoded by the gene Mefer_1180 in Methanocaldococcus fervens (the homologue of MJ0815 in Methanocaldococcus jannaschii, annotated as MfnD) that catalyzes the ATP-dependent addition of one glutamate to tyramine via a γ-linked amide bond. The occurrence of this reaction is consistent with the presence of γ-glutamyltyramine in cell extracts of M. jannaschii. Our steady-state kinetic analysis of the recombinant enzyme showed that MfnD exhibits a catalytic ability comparable to other ATP-grasp enzymes such as the Escherichia coli glutathione synthetase (GS), with a similar apparent kcat and KM. In addition, its activity is divalent metal-dependent, with the highest activity observed with Mn(2+). The previously solved crystal structure of MfnD from Archaeoglobus fulgidus exhibits a classical ATP-grasp fold with three structural domains; the ATP-binding and metal-binding motifs are conserved in MfnD as seen in other ATP-grasp enzymes. We used site-directed mutagenesis and kinetic analysis to demonstrate that Arg251 is an important residue for both catalysis and glutamate binding. By comparing the active site of MfnD with GS and by molecular docking substrates to the MfnD active site, we predicted the possible glutamate- and tyramine-binding pocket. This is the first report describing the enzymology of the incorporation of the initial l-glutamate molecule into the methanofuran structure. It also provides the first example of an ATP-grasp enzyme activating the γ-carboxylate of glutamate as substrate.