HpxO is a flavin-dependent urate oxidase that catalyzes the hydroxylation of uric acid to 5-hydroxyisourate and functions in a novel pathway for purine catabolism found in Klebsiella pneumoniae. We have determined the structures of HpxO with and without uric acid at 2.0 and 2.2 Å, respectively. We have also determined the structure of the R204Q variant at 2.0 Å resolution in the absence of uric acid. The variant structure is very similar to that of wild-type HpxO except for the conformation of Arg103, which interacts with FAD in the variant but not in the wild-type structure. Interestingly, the R204Q variant results in the uncoupling of nicotinamide adenine dinucleotide oxidation from uric acid hydroxylation. This suggests that Arg204 facilitates the deprotonation of uric acid, activating it for the oxygen transfer. On the basis of these data, a mechanism for this reaction consisting of a nucleophilic attack of the urate anion on the flavin hydroperoxide resulting in the formation of 5-hydroxyisourate is proposed.