We report the identification and characterization of the caz biosynthetic cluster from Chaetomium globosum and the characterization of a highly reducing polyketide synthase (PKS) that acts in both a sequential and convergent manner with a nonreducing PKS to form the chaetomugilin and chaetoviridin azaphilones. Genetic inactivation studies verified the involvement of individual caz genes in the biosynthesis of the azaphilones. Through in vitro reconstitution, we demonstrated the in vitro synthesis of chaetoviridin A from the pyranoquinone intermediate cazisochromene using the highly reducing PKS and an acyltransferase.