Aspergillus fumigatus siderophore (SidA), a member of class B flavin-dependent monooxygenases, was selected as a model system to investigate the hydroxylation mechanism of heteroatom-containing molecules by this group of enzymes. SidA selectively hydroxylates ornithine to produce N(5)-hydroxyornithine. However, SidA is also able to hydroxylate lysine with lower efficiency. In this study, the hydroxylation mechanism and substrate selectivity of SidA were systematically studied using DFT calculations. The data show that the hydroxylation reaction is initiated by homolytic cleavage of the O-O bond in the C(4a)-hydroperoxyflavin intermediate, resulting in the formation of an internal hydrogen-bonded hydroxyl radical (HO(•)). As the HO(•) moves to the ornithine N(5) atom, it rotates and donates a hydrogen atom to form the C(4a)-hydroxyflavin. Oxygen atom transfer yields an aminoxide, which is subsequently converted to hydroxylamine via water-mediated proton shuttling, with the water molecule originating from dehydration of the C(4a)-hydroxyflavin. The selectivity of SidA for ornithine is predicted to be the result of the lower energy barrier for oxidation of ornithine relative to that of lysine (16 vs 24 kcal/mol, respectively), which is due to the weaker stabilizing hydrogen bond between the incipient HO(•) and O3' of the ribose ring of NADP(+) in the transition state for lysine.