The heme enzyme indoleamine 2,3-dioxygenase (IDO1) catalyzes L-Trp oxidation in non-hepatic mammalian tissues by inserting both atoms of dioxygen into the indole ring to form N-formylkynurenine. In the present work, IDO1 was found to oxidize β-NADH under aerobic conditions in the absence of other reactants. This reaction led to formation of the reactive dioxygen-adduct of this enzyme and supported the oxidation of L-Trp to N-formylkynurenine. These processes were accelerated by hydrogen peroxide, and inhibited by either superoxide dismutase or catalase. In contrast, anaerobic reaction of IDO1 with β-NADH required an electron-transfer mediator. It is proposed that trace amounts of peroxide formed by reaction of dioxygen with β-NADH lead to one-electron oxidation of this substrate by IDO1, whose products reduce dioxygen to superoxide which in turn reacts with the enzyme to form the dioxygen-adduct. Regeneration of peroxide through auto-oxidation of the dioxygen-adduct of IDO1 results in auto-catalytic formation of this enzyme product in the presence of β-NADH. IDO1 was also found to catalyze the oxidation of indole by hydrogen peroxide, both of which were independently thought to be non-substrate, and non-oxygen-donor, respectively. This reaction resulted in O ₂-independent formation of monooxygenated indoles and was not inhibited by superoxide dismutase or hydroxyl radical scavengers. Consumption of indole and peroxide exhibited a near one-to-one correspondence and isotopic labeling experiments identified peroxide as the source of oxygen incorporated by indole oxidation products. It is proposed that indole oxidation was coupled to oxygen transfer from ferryl species of IDO1 formed by reaction with peroxide by means of a peroxygenase activity that is mechanistically analogous to the peroxide-shunt activation of cytochrome P450 enzymes. A bacterial expression system for a human isozyme of IDO1 (IDO2) was constructed. Despite similar electronic properties to IDO1, recombinant IDO2 was far less efficient at catalyzing L-Trp oxidation. The midpoint reduction potentials and auto-oxidation kinetics of IDO2 were comparable to those of IDO1, arguing against enzyme oxidation as a significant contributor of diminished enzyme activity. It is proposed that differences in L-Trp binding properties of the isozymes are mainly responsible for this catalytic disparity.