The non-heme iron-dependent enzyme SznF catalyzes a critical N-nitrosation step during the N-nitrosourea pharmacophore biosynthesis in streptozotocin. The intramolecular oxidative rearrangement process is known to proceed at the FeII-containing active site in the cupin domain of SznF, but its mechanism has not been elucidated to date. In this study, based on the density functional theory calculations, a unique mechanism was proposed for the N-nitrosation reaction catalyzed by SznF in which a four-electron oxidation process is accomplished through a series of complicated electron transferring between the iron center and substrate to bypass the high-valent FeIV═O species. In the catalytic reaction pathway, the O2 binds to the iron center and attacks on the substrate to form the peroxo bridge intermediate by obtaining two electrons from the substrate exclusively. Then, instead of cleaving the peroxo bridge, the Cε-Nω bond of the substrate is homolytically cleaved first to form a carbocation intermediate, which polarizes the peroxo bridge and promotes its heterolysis. After O-O bond cleavage, the following reaction steps proceed effortlessly so that the N-nitrosation is accomplished without NO exchange among reaction species.