A new pyrimidine catabolic pathway (the Rut pathway) was recently discovered in Escherichia coli K12. In this pathway, uracil is converted to 3-hydroxypropionate, ammonia, and carbon dioxide. The seven-gene Rut operon is required for this conversion. Here we demonstrate that the flavoenzyme RutA catalyzes the initial uracil ring-opening reaction to give 3-ureidoacrylate. This reaction, while formally a hydrolysis reaction, proceeds by an oxidative mechanism initiated by the addition of a flavin hydroperoxide to the C4 carbonyl. While peroxide-catalyzed amide hydrolysis has chemical precedent, we are not aware of a prior example of analogous chemistry catalyzed by flavin hydroperoxides. This study further illustrates the extraordinary catalytic versatility of the flavin cofactor.