Conversion of pyrogallol to phloroglucinol was studied with the molybdenum enzyme transhydroxylase of the strictly anaerobic fermenting bacterium Pelobacter acidigallici. Transhydroxylation experiments in H218O revealed that none of the hydroxyl groups of phloroglucinol was derived from water, confirming the concept that this enzyme transfers a hydroxyl group from the cosubstrate 1,2,3, 5-tetrahydroxybenzene (tetrahydroxybenzene) to the acceptor pyrogallol, and simultaneously regenerates the cosubstrate. This concept requires a reaction which synthesizes the cofactor de novo to maintain a sufficiently high intracellular pool during growth. Some sulfoxides and aromatic N-oxides were found to act as hydroxyl donors to convert pyrogallol to tetrahydroxybenzene. Again, water was not the source of the added hydroxyl groups; the oxides reacted as cosubstrates in a transhydroxylation reaction rather than as true oxidants in a net hydroxylation reaction. No oxidizing agent was found that supported a formation of tetrahydroxybenzene via a net hydroxylation of pyrogallol. However, conversion of pyrogallol to phloroglucinol in the absence of tetrahydroxybenzene was achieved if little pyrogallol and a high amount of enzyme preparation was used which had been pre-exposed to air. Obviously, the enzyme was oxidized by air to form sufficient amounts of tetrahydroxybenzene from pyrogallol to start the reaction. A reaction mechanism is proposed which combines an oxidative hydroxylation with a reductive dehydroxylation via the molybdenum cofactor, and allows the transfer of a hydroxyl group between tetrahydroxybenzene and pyrogallol without involvement of water. With this, the transhydroxylase differs basically from all other hydroxylating molybdenum enzymes which all use water as hydroxyl source.