The polyketide synthase (PKS) biosynthetic code has recently expanded to include a newly recognized group of extender unit substrates derived from α,β-unsaturated acyl-CoA molecules that deliver diverse side chain chemistry to polyketide backbones. Herein we report the identification of a three-gene operon responsible for the biosynthesis of the PKS building block isobutyrylmalonyl-CoA associated with the macrolide ansalactam A from the marine bacterium Streptomyces sp. CNH189. Using a synthetic biology approach, we engineered the production of unnatural 36-methyl-FK506 in Streptomyces sp. KCTC 11604BP by incorporating the branched extender unit into FK506 biosynthesis in place of its natural C-21 allyl side chain, which has been shown to be critical for FK506's potent immunosuppressant and neurite outgrowth activities.