The title enzyme, peptidylglycine a-hydroxylating monooxygenase (PHM), is essential to the in vivo generation of a wide variety of physiologically significant a-amidated peptide hormones from the corresponding C-terminal glycine-extended prohormones. Over a 20-year period of time a massive amount of experimental information about the enzyme has accumulated, but its mechanism of action has remained obscure. A major stumbling block to proposed mechanisms is the fact that the two copper atoms found in the active site are fixed 11 A apart. A novel mechanism is now proposed which accommodates and, indeed, requires this separation and proceeds through energetically accessible steps. It is proposed that hydroxylation at the terminal glycine residue of the C-terminal glycine-extended prohormone proceeds first by a concerted sequence of single-electron electromeric shifts, whereby both copper atoms are oxidized to Cu-H, oxygen is reduced to peroxide coordinated to Cu-H, and the glycyl group is tautomerized to its enolate coordinately bound to Cu-H. Upon subsequent reversion to the carbonyl tautomer, by a sequence of two-electron shifts, the enolate as nucleophile reacts with peroxide as electrophile, generating product alpha-hydroxyglycine, decoordinated from Cu-H, reopening the mouth of the active-site pocket to egress-of product and ingress of substrates. (C) 2003 Elsevier Ltd. All rights reserved.