Desaturation of a fatty acid first involves the enzymatic removal of a hydrogen from a methylene group in an acyl chain, a highly energy-demanding step that requires an activated oxygen intermediate. Two types of desaturases have been identified, one soluble and the other membrane-bound, that have different consensus motifs. Database searching for these motifs reveals that these enzymes belong to two distinct multifunctional classes, each of which includes desaturases, hydroxylases, and epoxidases that act on fatty acids or other substrates. The soluble class has a consensus motif consisting of carboxylates and histidines that coordinate an active site diiron cluster. The integral membrane class contains a different consensus motif composed of histidines. Biochemical and structural similarities between the integral membrane enzymes suggest that this class also uses a diiron cluster for catalysis. Soluble and membrane enzymes have been successfully re-engineered for substrate specificity and reaction outcome. It is anticipated that rational design of these enzymes will result in new and desired activities that may form the basis for improved oil crops.