The final step of the methylerythritol phosphate isoprenoid biosynthesis pathway is catalysed by the iron-sulphur enzyme IspH, producing the universal precursors of terpenes: isopentenyl diphosphate and dimethylallyl diphosphate. Here we report an unforeseen reaction discovered during the investigation of the interaction of IspH with acetylene inhibitors by X-ray crystallography, Mößbauer, and nuclear magnetic resonance spectroscopy. In addition to its role as a 2H(+)/2e(-) reductase, IspH can hydrate acetylenes to aldehydes and ketones via anti-Markovnikov/Markovnikov addition. The reactions only occur with the oxidised protein and proceed via η(1)-O-enolate intermediates. One of these is characterized crystallographically and contains a C4 ligand oxygen bound to the unique, fourth iron in the 4Fe-4S cluster: this intermediate subsequently hydrolyzes to produce an aldehyde product. This unexpected side to IspH reactivity is of interest in the context of the mechanism of action of other acetylene hydratases, as well as in the design of antiinfectives targeting IspH.