Terretonin (1) is a fungal meroterpenoid isolated from Aspergillus terreus, and possesses a highly oxygenated and unique tetracyclic structure. Although the biosynthetic gene cluster for 1 has been identified and the biosynthesis has recently been studied by heterologous reconstitution and targeted-gene deletion experiments, the last few steps of the terretonin pathway after terrenoid (6) have yet to be elucidated. Notably, the mechanism for the D-ring expansion to afford the terretonin scaffold has been a long-standing mystery to solve. Here we report the characterization of three enzymes that convert 6 into 1, as well as the complete biosynthetic pathway of 1. In the proposed terretonin pathway, the cytochrome P450 Trt6 catalyzes three successive oxidations to transform 6 into an unstable intermediate, which then undergoes the D-ring expansion and unusual rearrangement of the methoxy group to afford the core skeleton of 1. This unprecedented rearrangement is catalyzed by a novel isomerase Trt14. Finally, the nonheme iron-dependent dioxygenase Trt7 accomplishes the last two oxidation reactions steps to complete the biosynthesis.