In our efforts to understand the nature of metal thiolates, we have explored the chemistry of cobalt ion supported by (thiolato)phosphine ligand derivatives. Herein, we synthesized and characterized a square-planar CoII complex binding with a bidentate (thiolato)phosphine ligand, Co(PS1″)2 (1) ([PS1″]- = [P(Ph)2(C6H3-3-SiMe3-2-S)]-). The complex activates O2 to form a ligand-based oxygenation product, Co(OPS1″)2 (2) ([OPS1″]- = [PO(Ph)2(C6H3-3-SiMe3-2-S)]-). In addition, an octahedral CoIII complex with a tridentate bis(thiolato)phosphine ligand, [NEt4][Co(PS2*)2] (3) ([PS2*]2- = [P(Ph)(C6H3-3-Ph-2-S)2]2-), was obtained. Compound 3 cleaves the C-Cl bond in dichloromethane via an S-based nucleophilic attack to generate a chloromethyl thioether group. Two isomeric products, [Co(PS2*)(PSSCH2Cl*)] (4 and 4') ([PSSCH2Cl*]- = [P(Ph)(C6H3-3-Ph-2-S)(C6H3-3-Ph-2-SCH2Cl)]-), were isolated and fully characterized. Both transformations, oxygenation of a CoII-bound phosphine donor in 1 and alkylation of a CoIII-bound thiolate in 3, were monitored by spectroscopic methods. These reaction products were isolated and fully characterized. Density functional theory (DFT, the B3LYP functional) calculations were performed to understand the electronic structure of 1 as well as the pathway of its transformation to 2.