Sulfatases are a major group of enzymes involved in many critical physiological processes as reflected by their broad distribution in all three domains of life. This class of hydrolases is unique in requiring an essential post-translational modification of a critical active-site cysteine or serine residue to C(alpha)-formylglycine. This modification is catalyzed by at least three nonhomologous enzymatic systems in bacteria. Each enzymatic system is currently considered to be dedicated to the modification of either cysteine or serine residues encoded in the sulfatase-active site and has been accordingly categorized as Cys-type and Ser-type sulfatase-maturating enzymes. We report here the first detailed characterization of two bacterial anaerobic sulfatase-maturating enzymes (anSMEs) that are physiologically responsible for either Cys-type or Ser-type sulfatase maturation. The activity of both enzymes was investigated in vivo and in vitro using synthetic substrates and the successful purification of both enzymes facilitated the first biochemical and spectroscopic characterization of this class of enzyme. We demonstrate that reconstituted anSMEs are radical S-adenosyl-l-methionine enzymes containing a redox active [4Fe-4S](2+,+) cluster that initiates the radical reaction by binding and reductively cleaving S-adenosyl-l-methionine to yield 5 '-deoxyadenosine and methionine. Surprisingly, our results show that anSMEs are dual substrate enzymes able to oxidize both cysteine and serine residues to C(alpha)-formylglycine. Taken together, the results support a radical modification mechanism that is initiated by hydrogen abstraction from a serine or cysteine residue located in an appropriate target sequence.