The first step in the biosynthesis of pterins in bacteria and plants is the conversion of GTP to 7,8-dihydro-d-neopterin triphosphate catalyzed by GTP cyclohydrolase I (GTPCHI). Although GTP has been shown to be a precursor of pterins in archaea, homologues of GTPCHI have not been identified in most archaeal genomes. Here we report the identification of a new GTP cyclohydrolase that converts GTP to 7,8-dihydro-d-neopterin 2',3'-cyclic phosphate, the first intermediate in methanopterin biosynthesis in methanogenic archaea. The enzyme from Methanocaldococcus jannaschii is designated MptA to indicate that it catalyzes the first step in the biosynthesis of methanopterin. MptA is the archetype of a new class of GTP cyclohydrolases that catalyzes a series of reactions most similar to that seen with GTPCHI but unique in that the cyclic phosphate is the product. MptA was found to require Fe2+ for activity. Mutation of conserved histidine residues H200N, H293N, and H295N, expected to be involved in Fe2+ binding, resulted in reduced enzymatic activity but no reduction in the amount of bound iron.