Molybdenum cofactor (Moco) is essential for all kingdoms of life, plays central roles in various biological processes, and must be biosynthesized de novo. During its biosynthesis, the characteristic pyranopterin ring is constructed by a complex rearrangement of guanosine 5'-triphosphate (GTP) into cyclic pyranopterin monophosphate (cPMP) through the action of two enzymes, MoaA and MoaC. Recent studies revealed that MoaC catalyzes the majority of the transformation and produces cPMP from a unique cyclic nucleotide, 3',8-cyclo-7,8-dihydro-GTP (3',8-cH2GTP). However, the mechanism by which MoaC catalyzes this complex rearrangement is largely unexplored. Here, we report the mechanistic characterization of MoaC using an uncleavable substrate analogue, 3',8-cH2GMP[CH2]PP, as a probe to investigate the timing of cyclic phosphate formation. Using partially active MoaC variants, 3',8-cH2GMP[CH2]PP was found to be accepted by MoaC as a substrate and was converted to an analogue of the previously described MoaC reaction intermediate, suggesting that the early stage of catalysis proceeds without cyclic phosphate formation. In contrast, when it was incubated with wt-MoaC, 3',8-cH2GMP[CH2]PP caused mechanism-based inhibition. Detailed characterization of the inhibited MoaC suggested that 3',8-cH2GMP[CH2]PP is mainly converted to a molecule (compound Y) with an acid-labile triaminopyrimidinone base without an established pyranopterin structure. MS analysis of MoaC treated with 3',8-cH2GMP[CH2]PP provided strong evidence that compound Y forms a tight complex with MoaC likely through a covalent linkage. These observations are consistent with a mechanism in which cyclic phosphate ring formation proceeds in concert with the pterin ring formation. This mechanism would provide a thermodynamic driving force to complete the formation of the unique tetracyclic structure of cPMP.